I just bought a used 2005 CR-V and I have a valet key and one master key that is programmed with buttons to open the all 4 doors, and the trunk. But the duplicate master key was in a baggie with the black plastic top with the buttons on it all smashed up and broken. Honda wanted $360 + to make a new key, program the new key and reprogram the old key. Is it possible for a locksmith to do that at a lesser cost?

 

Yes, there are a few locksmiths that can laser cut the key and program the keys for your car. You should call them first to see if they have the proper equipment.

 

If you can dig the immobilizer chip out of the busted key you can do it yourself for very cheap. You can even get the nice Acura switchblade key and swap out the immobilizer, and reprogram, it's very easy (easy to find instructions for this step online). The hardest part is just squeezing the immobilizer into the new chip, which if you have a soldering iron to slightly melt the plastic is no work at all. The Acura part number with the correct FCC ID is TRANSMITTER ASSY., KEYLESS (MEMORY 1) (72147-SEP-A21). 35113-TK4-A00 Does not work (made that mistake).
If you just want a new regular replacement like came with the car, you just put the old immobilizer chip in a new part - I think part 35111-S9A-305 - and have it cut. My Honda dealership cuts keys for free if you take the blank in to the parts desk. Just tell them you're making a lock-out key and they won't give you much of a hassle.

If the old immobilizer chip is lost or damaged you will have to order the entire key (that part number above) and they use a special tool to reflash the immobilizer chip. That's probably the cost that they quoted you.