The key phrase in the appraisal is "for insurance purposes". Appraisals for insurance purposes are always higher than the true value.
It is not uncommon to spend more restoring a machine than it is worth in the end.
Many times people have contacted me with an original machine that they want to sell. They want to know what it would be worth as is and if it were restored. In the vast majority of cases the value added to the machine by restoring it is less than the cost of the restoration. Of course, this assumes the machine was not a nice original and restoring would actually hurt the value.
The show "American Restorations" has had several slot machines on it. In every example, the price that he charged to restore the machine exceeded the value of the machine after it was restored. Of course, he does not tell the owner that and usually gives the owner a very inflated value of the machine once it was restored. I think he once restored a Rol-A-Top and told the guy it was worth over $9,000 after it was restored. I think he charged the guy something like $3,500 to restore it which was about what the machine was worth after he restored it.
Because most appraisals are worthless is one reason why I started the online price guide which tracks actual sales (
http://www.AntiqueSlotMachinePriceGuide.com).
Below is a scatter plot showing the prices of War Eagles