Take a look at the video on their website. Yes, they use the BACKBONE modified HERO 7. This turns this little camera into an interchangeable lens compact camera. They use a different focal length lens than the standard lens that comes on a stock HERO 7 I believe. This is a specialty camera, NOT a standard GoPro HERO 7. The price is high, yes, but I don't think they are gouging anyone considering they are probably paying about what you or I would for the modified camera. It's like anything else... you want the best tech toys... you have to pay for them.
However, I think releasing this at this price point, using a modified genuine GoPro HERO 7, will be the best promotion of the Russ Baer Scope-Cam that Russ Baer will ever see. I think he uses a GoPro clone, to produce a similar side-mounted rig. However, it's a clone action-camera, and I know nothing of the focal length, and I'm sure the quality wlll be nothing to compare to that of the Backbone GoPro HERO 7. Just my suspicion. That brings us back to if you want the highest quality, expect to pay the highest price.
I think if the want to sell these units, they will have to do something along the lines of take the sideshot mount for the phone, which they already have in production, and can be sold at a profit for $200, and modify it for the GoPro housing (which they obviously do), This process should be made to allow them to still be sold at the $200 price point. Then, add the BackBone GoPro Hero 7 to that ($900). That would mean the BEST we could reasonably hope to see this unit go for is $1100. Still too high in my opinion for the general airgun market at this point. Maybe when the HERO 8 comes out and the HERO 7 drops, it'll help, but who knows.
Again... you want the best, you have to pay the most.