
I am in Agreeance (Yes that is a word I made it up b/c engineering doesn't only apply to machines LOL)
Unless you feel like buying another head b/c that shop messed up I would find another shop that does rebuilds on pre UL gasoline engines on a regular basis they tend to know more about installing new seats into old heads.
The 78 and later heads have hard seats already though but they weren't pressed in types like you might have to use when rebuilding a pre '78 head w/o the hard seats.
Also even if they had to drill out so much they shouldn't have a problem pressing in new seats. It is a very routine operation with pre '78 heads
BOTTOM line I would find another shop if this isn't their cup of tea.
Personally IMHO I don't know how bigger valves would help on a '78 head w/o some porting, cc 'ing the chambers, and maybe de-shrouding in the chamber. I would still only venture in that direction if I intended to swap in an aftermarket cam depending on what you plan to do. I like to think along the lines of a better cam needs better ports or else you can't take advantage of the duration. (that's my butt talking but it made sense when I thought about it

)
I still wouldn't let this shop do your head work.
Hey there's an idea for Mike! for those people who don't wish to use the CI Aluminum Head they could ship their Iron head to him and have his guy do the porting. I'm sure it would be better than some local shops on account of I thought Mike had to slice up some iron heads during the R&D phase of the CI Aluminum head! 8)
Keep Sixn'