I wasn't involved in this, but this "surcharge" nonsense really sounds like a legitimate scam. It's like a bait-and-switch. They rope you into buying a large quantity on the premise you'll be getting a per-item discount, then they tack on a bullshit "surcharge" that essentially nullifies the discount? That's not just false advertising, it's unscrupulous.
If I had in any way been involved in this buy, I would have told them to go to straight to hell at the first mention of any "surcharge" of this magnitude. If the things ended up costing the same in the end as if you'd bought them all separately, you really got screwed because not only did they cheat you out of a discount, you had to go through the gigantic hassle of organizing a group buy, sorting, testing, and forwarding.
Hopefully you guys still got some sort of small discount after all was said and done. We need to remember this for future reference, however.