So I'm getting 35's here soon, and I decided to regear to 4.88's.. I assumed that a shop would quote me around $1000 for both the front and rear axle, but I just got a call about the quote and they told me it would be $2000.

This is the highest quote I've ever seen for a regear, I had a good chuckle over the phone about it.

How much did you pay for your regear?

 

that price sounds about right

they remove the axles in most cases and place them on a jig

 

Yes, I would agree, $1,000 an axle, parts and labor.
I am sure you can find a shop to do it for less than $2,000

20 years ago $500 and axle would have been about right.

Shops have to use more expensive parts and have to warranty those parts and their work.

If you bill your time at $10/hour and add the cost of the parts, then multiply that by 4 you will usually be close to Shop cost for that work.
4.88 ring and pinion $190
6 hours to swap $60
$250 x 4 = $1,000

And if there is a problem with a part you have to do the disassembly and deal with the warranty, if any, to get replacement part and then reassemble.