They're talking about mudding the walls, which, if you can find someone that still has the skills, is a nice way to achieve flat/plumb walls when the studs may not be all that great. Pricewise, that's in-line...could be more, could be less, with a lot of that depending on where you live. Some of the price depends on the tile used, which can vary from $1/sqft to over $100 just for the materials. The critical thing is how they plan to build the pan, as when doing a conventional shower, this requires a preslope, waterproof liner, then the setting bed. If they're talking about putting the liner on the floor, flat, get another quote from someone who will do it per industry standards.
It's good to educate yourself on the proper way(s) to build a shower - there are many. There are many more ways to mess up! Check out www.johnbridge.com and look through their 'Liberry' section. The bible in the USA is the TCNA handbook (Tile Council of North America). This lists the available, tested, approved ways to build most anything using tile. Personally, I prefer a surface membrane verses the traditional methods. In some ways, it is simpler. In a totally cement based traditional shower, moisture will penetrate some into the substrate (the pan and the walls, especially where the showerhead spray hits regularly). A surface membrane puts a waterproof layer immediately beneath the tile. If using something like a good porcelain tile (good does not necessarily mean expensive), the tile itself won't absorb much of any moisture, and the whole shower dries out very quickly. Mold takes three components: moisture, food, and the spores. The only one that is easy to eliminate is the moisture if you use a surface membrane to stop it penetrating. A conventional shower can last and perform quite well, I think the newer techniques add some neat, useful features and benefits. And, they can go together easier and quicker. Quicker means less money and downtime.