I think the main problem for me with such a hefty refill price would be if it were not prominently displayed on the menu. Restaurants can charge whatever they want for whatever they want, in theory anyway (inappropriate prices will eventually catch up with them), but no one wants a SURPRISE when the bill comes.
I haven't seen the menu for The Pickle Factory, so I can't say if 30ABandman missed some bold print or fine print or if there wasn't any print at all telling him the price of refills.
One of our favorite Thai restaurants charges a $1 refill on all drinks except water. The menu reads: "Iced Tea $2 (refills $1)." That lets us know we can either drink a glass of tea and then switch to water, or go HOG WILD and spend another dollar on a second glass of tea...if its our anniversary or something. (From a practical standpoint, I do wonder at what point the cost of handling/washing the extra water glasses would outweigh the cost of simply giving the customer a free refill of tea or fountain soda.)
Anyway, this post won't stop me from trying The Pickle Factory (although we're addicted to The Pizza Bar). I might raise some eyebrows at the prices in Sowal, in general, but as long as the prices are displayed on the menu and I can order as an informed consumer, I can't complain.