I totally agree with this. I'm a very customer-oriented person, but there are a few customers that just aren't worth supporting. If you can reject them gracefully, it's in your best interest to do so.

One of the problems with that is that even jerks have friends. If you reject them, they'll tell those friends and you could lose even more customers.

In this case, when they were going to have to write a custom solution for this customer, it was definitely the way to go.

As a side note, my father asks for 'discounts' all the time. He almost never gets them, and doesn't act entitled when he doesn't, but it sometimes works. So he keeps doing it. I really have to start doing it myself to see what I get.