I've just finished a 16 page, A4 folded to A5 leaflet/brochure (call it what you will) for a well known (in the South East, anyway) furniture restoration company. Barring the front cover, inside front and back cover, all the pages were the same formula. 2 product images per page, with between 2 and 10 supplementary images with each and covering copy and caption. All the main images needed to be cut out and colour balanced as all the supplementary images (square-ups) also needed to be colour corrected. In all, I was quite lucky on this one as although there were probably 6 or 7 waves of amends, they weren't too comprehensive (apart from the first lot).
In terms of hours spent, it totaled approximately 40 hours, all done over the space of a week and a half. Regardless of your hourly rate, a publication such as the one you describe is going to be a whole lot of work. 60 pages on your own is a massive undertaking, let alone 160. Be more than sure of what your client is going to be asking you to do, including:
How many pages are editorial;
how many pages are going to contain supplied artwork;
how is supplied artwork going to be supplied and how easy would you deem any file conversions or alterations to be;
how many images are going to be used, will they be raw images that need to be converted into another format, will they need colour correction, cutting out, retouching;
is there any original artwork/design/illustration work to be done;
is it required to be done in certain software (you'll be amazed how many people I have ask me for artwork to be done using a complete InDesign workflow, although the exact same results could have been achieved using Quark and printed from Photoshop!);
are finished PDFs required (allow time for producing hi-res PDFs from hi-res files)?
it goes on...
Also one thing to bear in mind, is that if you're going to need help on this, you're going to need to allow for freelancer charges.
In these cases, no such thing as too much information. If it's possible to work to a formula, you can quote per page - just ensure you break it down bit by bit when detailing your charges.
In answer to your question - yes, £400 is way too cheap and if they haven't bitten off both you arms and legs and made a start on your privates, then they are effectively branding you worthless!
You might have an hourly rate, but if you're spending more hours doing this than you've quoted, that rate no longer applies - you've set your bar, you stick to it.
For a relatively basic design, I'd allow 15 mins per page (that's 10 hours basic - importing and placing pics, placing and styling copy, gridding and checking spelling/cropping pics, liaison with client...) Then on top of that, client amends and the more involved items such as pic retouching etc. Don't be afraid if the price mounts up - you know what you're worth and if the client thinks they can get it done elsewhere, once you've entered into *reasonable* negotiation, if it's still too high, walk away. Hours of work for little profit just isn't worth it - unless you really feel in your heart of hearts it is.
From experience, the amends can add up to half the extra time spent (particularly on such a large publication) and the graphic involvement will add to that even more.
Your call, but should they go with it, get some of the fee up front - if they are serious, 50% should be acceptable. Detail your time spent to the max. Here endeth the lesson - hope that helps...