At the risk of repeating.
There is no such thing as "bad fluid" and whatever fluid is in the ABS system did not cause the electronic module to fail. The problem with the original fluid, as I understand it, was that the original ABS fluid is water soluble and the original compound would not hold the moister in suspension for the recommended flush/replace interval of two years thereby allowing corrosion to some ABS components. Is it possible that corrosion could have damaged the electronic control module; don't know. However, if the OP can verify that the required two year flush/replace ABS maintenance was followed, he should have taken a hard line with the dealer, trailered his bike home, contacted the Mothership before taking any further action and considered taking his bike to another dealer. I also have to believe that if an electronic sensor had been damaged, particularly a sensor in the such a critical system as the ABS, a code would have been thrown.
Considering that the MoCo engineers erred on the side of safety, the two year period is very likely much longer, probably at least four years or longer which may be why it has taken this long for the recall; speculation on my part.
The new Platinum fluid is not even available yet at many dealers so I would suggest that the OP verify with the dealer and get a printed record of the flush/replace; from my previous post.
The dealers have to do the service correct or the mother ship will know; everything done in DigiTech is sent back as a CYA record. It is my understanding that most dealers will not have the new HD Platinum Label DOT 4 fluid until March. I would not have the service done until I was assured the new fluid was available.
I monitor several HD forums and have yet to see anyone that had ABS parts damaged or have had to pay for any parts replacement or any additional labor.
Furthermore, if the OP thinks that the MoCo is trying to solve their financial woes he is dreaming. This is not the first time the MoCo has seen sales revenue and profitability drop off and the MoCo's response has been rather bold in the past. The M8, although there are some issues, is a step in that direction; the MoCo has also stated that the intend to introduce many new models over the next ten years; the electric bike is due to go on the market as a 2019 model, the Dyna has been eliminated and morphed into the Softail line, I expect the Sportster is not long for this world either, etc. The MoCo can't solve their sales problems with recalls. The cost involved in the development of the new Platinum fluid as well as the labor to provide the service will not be off set by charging everyone $700 extra.
Bottom line for me from the OP's posting is that a dealer may have financial issues and will try to offset sales revenue by taking advantage of the recall and charging customers that do not question the charges for additional services. Did the OP ask the dealer for the damaged electronic module? Is the OP certain that it was replaced?
I rambled in my previous and failed to make a couple of points and I wanted to edit the post and boil it down but too late.
I seriously doubt that an electronic module in the OP's ABS system was damaged, but could be wrong. Having said that and to the point Joel makes, if the OP followed the prescribed two year flush/replace maintenance schedule via the dealer, the dealer has recorded the services under the OP's VIN, so there is a record. If an ABS component was damaged, it was damaged by the fluid that was replaced or by the tech the performed the service and, therefore, the repair/replacement should be the dealer's responsibility.
The OP should have gone to full stop when advised of the $700 additional charge and challenged the dealer as well as contacted HD Corporate.
If you get a letter, take the bike in for the free service. It will be done by DigiTech II and will be on record. However, be prepared to challenge the service manager that tells you there is going to be an additional charge and make sure that the additional expense is justified.
I empathize with the OP but ultimately it is on the owner to understand why and for what he/she is being charged and challenge until satisfied that the charge, for whatever, is legitimate. There is a lot of information on other forums on the ABS recall.