I still don't see what your complaint is..
They didn't do any work to it, other than charge you $40 for the teardown.

They *might* have been trying to rip you off with the "requires welding" / leaks / blah blah.. But you won't know for sure until you take it to another shop.

Want to file a BBB complaint, get their cost estimate in writing and then take it to another shop. When the "other" shop says that it's fine - they you can complain. Until then, you're making a guess - and you're probably right - that they were upcharging you on a head for work you didn't need... Without some opinion from another shop, I don't know what good that guess is going to do you.

Oh yea.. Expect the "we were talking about another customer's head" excuse also.