I'd be a bit miffed (ok, MORE than miffed) if the shop that was making a killing renting a mediocre, used, older bike was also the one that was the entire reason that I'd had to keep it that long.

I'm sorry, but 6 weeks is entirely unreasonable for a repair unless you knew up front about the time and had been kept up to date. Doesn't sound like that's the case because I seriously doubt you'd have agreed to the rental if you'd have known it would have been that long (and thus that much $$$).

Heck, given this time lapse you could have gotten a passible beater off craigslist for a couple hundred (sans insurance involvement), and just sold it for about what you paid for it at the end of this fiasco.

I have no idea what the actual situation is here (and don't need to), but you and the owner/manager of the shop need to sit down and have a very frank conversation about this situation.

I'm not convinced that the solution is to ask him to let you keep the bike necessarily, but perhaps reduce/remove the rental fee, especially for the weeks far beyond initial estimates. (It is NOT unheard of for shops to hand out "demos" free if they screw up a repair estimate and the rider NEEDS a bike. Typically done for planned races/tours/etc, but still).