That stinks to hear about your suit. It one be one of those lost in translation type of things too. Samples, Size Demos, Size Runs, and even Rainbow Runs are all common production terms in the manufacturing world. Demo can also mean a quick mock up for a photoshoot or to send to web testers on preproduction hype or to bring to OR and trade shows. Websites are a pain in the ass to keep up with and one off products don't always get the TLC a full production product would get.
Just a thought, but it may be cheaper to take your suit to a local repair shop than shipping it back and forth to Canada. Shops like Stitchlines in Denver, Ripstop Repair in Boulder, or Rainy Pass in the PNW would all do a bomber job in putting in seam tape. It would most likely cost less to have them repair it than it would to send it oneway to Canada. Just leave the aquaseal off and let them weld the seams when they tape it. Aquaseal would work, but you'll stiffen up the suit and loose some breathability.
$350 would be the cost of materials for a drysuit and way less than Proform and wholesale prices. They might have their hands tied with the cost you paid. They are in a tough spot because they are not servicing a retail customer. They are servicing a one time off the Clearance Rack customer that wants retail service. It's a tough balance for sure.
Level 6 does make some good products you should stick with them for their retail stuff. I've been in the Outdoor Industry for a long time and the one thing that I learned a long time ago is that you get what you pay for. I stopped shopping off the Sample/ Demo/ Clearance Rack 20 years ago. It's way to easy just to buy off season if you're looking for a deal.
Good luck with the suit. I'd take it to Stitchlines in Denver- they do drywear and they have worked with Patagonia for 15+ years. They know drysuits. You'll save a ton of money in shipping and time out of hand.
I love to dance, but who needs the music- It throws me off.