I'm betting Dako hit the nail on this one. I think the problem here is both sides went to DEFCON 1 right out of the gate and when that happens no one wins (ever see War Games?). I'm guessing you were pretty pissed when you found that rust and got in touch with the shop owner while still in that mental state, and he naturally got defensive because he probably had no idea what had happened because his guys had told him something different and his first instinct is look out for his side. He escalated, you escalated, and before you know it you're both throwing down gauntlets that don't benefit either of you.
Are you justified in doing that? Absolutely! But what did you gain from it? You're going to have to pay more for someone else to do the repair, and now you've got to get your other stuff and go through the process of finding someone else to do that work. In short, you lose. Was he justified in what he did? Maybe, depending on how abrupt and accusatory you were on the phone. And did he gain anything from it? Nope. He's losing your business plus the business that would have stemmed from you in the future.
A better way to correct the situation would have been to call him, tell him you have a concern about the work he did, and ask him to come by and take a look or if you can run the car over to him (assuming you can drive it). This does two things: first, you get time to cool off, and he'll likely go out and talk to his crew about what could have gone wrong that is resulting in you having a problem. If he's like most owners, he'll create far more major problems in his head that what yours actually is, and by the time he sees the problem he'll be happy it's something relatively minor, realize his crew screwed up, and fix the problem.
Even the best shops make mistakes, and shop owners who do good work, as you said this guy did, usually back their work. But but an irate caller can turn even the best shop owner into a defensive monster and you'll never get anywhere except through the courts, which tends to be more of a moral victory than a financial one.