I had a similar experience many years ago. I spent several hours writing some pseudocode to show how I would solve a particular problem.

The interviewer rejected it and said he wanted working and tested code, which I estimated would take nearly 100 hours to do.

I told him I wasn't interested in working for free, but I would gladly do it for my normal consulting fee that I was charging at the time.

Didn't hear back from him. Dodged a bullet there.