For feathering edges like you describe, I would use a hot mud compound rather than a pre-mix because you can control its density. It is harder to sand but that is no really big deal with carbide paper.
It comes in plastic lined boxes (5 minute) or sacks with cure times from 5-90 or even 120 minutes. I would get a cheap Rubbermaid type container to store the sack. For a first time DIYer I would go with the 20 or even the 45 minute. You can always wait for it to set. The 5 minute is not for the faint of heart.
Hot mud starts curing the minute moisture hits it. You don't want to mix more than you can use before it sets. I usually mixed batches in my drywall pan unless I had a laborer I could trade of pans with and that did nothing but keep mixing.
Whatever compound you use, you should get yourself a nice, wide, drywall blade with some flex to it for this. I liked one the width of my drywall pan but if that is two big for you to handle comfortably you can cut back. If you try to use a 4-6 inch taping knife to blend or skim coat you will end up having to do a lot of sanding and the nice thing about a wide blade is it catches enough wall surface to give you nice even transitions.
As for your question. Blending in defects like yours on old walls went with the territory when I was painting and amounted to some work but I never viewed it as problematical. Are these painters quoting for you familiar with working on old houses and their walls?
By the way, be mindful of lead in the existing paint if you are sanding down that far. Abate as needed. Where protective and disposable clothing and use a dust mask. Turn off your HVAC system so you do not circulate the dust.