IMO, it will never be a collector item with the initials engraved on it. That is the price one pays if they want to personalize a firearm.
However, any barrel length 29-2 in either finish, even without all the original extras (case, tools, literature, orig grips) and in 95+ condition is an absolute bargain at the price you indicate.
It never hurts to make an offer. I'd try for $100 less but pay the asking price if I had to. If you buy it you'll be amazed what excellent shooters the 8 3/8 inch 29-2s are.... The 4" guns are currently the more popular and that is the reason the long tubes are selling for less. The long tubes offer a wonderful buying opportunity for the aware purchaser today and the popularity of barrel lengths that influences future values changes frequently.....
JMHO