First of all - I personally would not pre-pay anyone $7000 for dance lessons, even with a contract that spelled out refund terms.
Having said that, it may not necessarily be a bad deal: we don't know how many lessons Isabel would get for $7000, nor the quality of her instructor. If Isabel got only 50 lessons for that or got a poor quality instructor, well, then yes, it's probably a bad deal.
But, on the other hand, I know one pro-am student who pays $70 per hour for lessons with an instructor (with a good string of competitive accomplishments); she takes 2 lessons every week - so that's 104 lessons per year or $7280. So, if that student paid $7000 a year for lessons, s/he would probably think that $7000 was a fair deal.
One of my (independent)instructors reminds me every so often that I can pre-pay for lessons and get a bit of a discount. I always decline. I do not see that as "pressure" to buy a package - but I suppose others would and would complain. And then, there are still other people who would be upset if he DIDN'T remind them that they could pre-pay for a discounted price and would claim that he offers it only to "special" students. Teachers can be damned if they do and damned if they don't.
We don't know the whole context of Isabel's studio. What she feels is pressure from the studio might not be pressure at all in someone else's book. However, in Isabel's case, it makes her uncomfortable, she doesn't trust them and that alone is good enough reason to look for a different teacher/studio.