It has always been my opinion, and I admit it's more of a gut feel than a true informed opinion, that Glenn, Don, and Irving finally settled for three main reasons. As you said, Dreamer, $3k meant they knew there'd likely be more later. Second, having actually go to court would have made public a lot of things, good, bad, and indifferent, that they prefer to keep private. Keeping in mind that these guys are just as private with the good things as the bad things, so wanting privacy doesn't mean they felt they were at fault in anything. Lastly, they wanted and needed to move forward with LROOE, and they couldn't do that with this hanging over their head. Besides legalities, they wanted it behind them, over and done with, and all talked out before promoting the album and touring.

Given all that, they probably offered more than what they would have otherwise, and I feel that Felder accepted it because he either knew it was more money than he'd probably get in court, or because the legal aspect was costing more than he wanted to keep shelling out. Or both.

Regardless of what side you're on, it's always the lawyers that make out the best.