Here's the issue.
Many dog's can live for years with a medial patellar luxation problem. it all depends on if there are symptomatic (does it pop out often enough to bother them, or is it painful when it happens). many times, the grade one and two luxations are not. A grade 3 or 4 generally would benefit from surgery at least somewhat sooner than later.
The cost does sound a bit high. For that price, it better be a surgical specialist doing the procedure. If not, its a high cost.
Even in Southern California, both kness could be done for the lower end of that price range probably by a specialist.
So, first things first. Bring your pet into another vet. Ask them to evaluate the knees. Say nothing more. if they don't comment (they should), ask what grade are they? Grade one through four.
That will help you to gauge your first vet's accuracy of the situation and if rushing into the surgery is necessary, but you need that other opinion.
P.S. Here's some more info you DEFINITELY should review:
Increased frequency of limping, pain when it occurs, having regular annual examinations with your vet to have the knee palpated to differentiate any changes in the "grade" of luxation I mentioned above....
The grade is really important. If it moves in and out a lot, it can exacerbate degenerative joint disease (arthritis) in the knee over time.