i paid, from memory, ~AUD$650'ish for mine (i bought an F5, 20-25, 35-70, 80-200 and an SB25 all at the same time, so i got a decent discount on the package).I paid a little more than twice what you did and I still feel well bought.
mind you, that was 16 years ago and the lens has paid for itself many, many times over. given the kind of work i do involves taking a lot of 'social' pictures at various sporting and social functions for the paper i work for, the 35-70 range is the perfect piece of gear.
you're right about the flare. you need to be careful shooting into the light. i lost the lens hood many moons ago and just use my hand as a hood when needed. mines 'acceptable' wide open, but once down to f4, it's like a razor.
my 35-70 now sits proudly on my D3s, that's the SIXTH camera body the one lens has been used with (an F4, 2xF5, D70, D700 and now the D3s).
one of the things i like most about it is the fact it doesn't draw attention like a 24-70 will. if i take the grip off my D700 and use the 35-70, to the untrained eye i look a lot like Joe Public with their D7k + kit zoom.
if you can't tell, i am a HUGE fan of this particular piece of gear.