That's what I hinted at. Those fakes are not even allowed to be put on the market in some countries. A Fed, a Zorki labelled as Fed, Zorki, would not be termed "Leica copy" by a serious seller. A fake Leica, that is a Zorki with counterfeited Leica marks on it, should never be termed "copy" and sold at those prices with the hint that is a valuable collectable camera, maybe not a real Leica, but not less worth than an original Leica. The price which is asked is more than what would be normal for a proper original Leica III.
It should be labelled as a fake Leica, stressing it is actually a Zorki counterfeited as a Leica. Those cameras change hands for around €100,00 on eBay when they are in very good condition, no more than the Zorki they descend from.
Those "military" Leicas are actually "twice fake" as Leica never produced any special series for any German armed force. Frankly I find this quite unfortunate for a reputable seller, and I think it should be reported to the shop - by some happy customer with a good relation and knowledge of the of the correctness of the shop - the shop might be in good faith in not understanding how mispriced the item is (an inexperienced persons might have priced the item)
PS Somebody might think that any price might be asked by a seller and whatever price is agreed by seller and buyer is a legitimate price. I would agree in general, but certainly not when there is a counterfeited object on sale. If my father had bought that camera at that price, I would write here to cry scam (they even report the serial number, as if this was not counterfeited as well!).