Dealers lie/cheat/steal, which is why they're known as "stealers". That may or may not be the case here, but just because they don't have any direct experience with the OEM m/cs failing doesn't mean everyone else doesn't.
Since it sounds like you have an extended warranty with Fidelity, I would contact them and explain the situation. You may have to have a different shop perform the work if the stealer is unwilling.
Flushing the m/c/brake lines will usually bring it back to life temporarily, but it'll just happen again. The OE units just aren't made well, and don't seem to tolerate heat as much as they should. The aftermarket units are much better made, and fully rebuildable from the interior side, so the clam should never have to come off again* for a failing m/c seal.
* there are some reports that claim the m/c can be changed without removing the clam, but no one has produced any photo evidence of this, so YMMV
2011 Evora NA - Phantom Black | Paprika | MT | 2+.5