Speed sensor..plus..?

95 4Runner issue: :banghead:

I was driving and all of a sudden my speedometer went from 40 to zero and my trans wouldn't switch gears. I have taken to a shop and was told that both the electrical and mechanical speed sensors have failed and the rotor inside the transmission holding shattered. Since that shattered there are many small pieces of it floating around in the fluid and the mech told me to replace both sensors, flush the trans fluid, and replace the rotor.

Estimated price - $600?..?

Does this sound like a valid problem or a money-swindling mech? I was originally told it ws a small speed sensor job so I am hesitant about paying for all of this. Is there any way to do this cheaper with used parts?

How will this affect my trans in the future as well?

Thanks to whoever can help!