It’s not a “gesture of goodwill” it doesn’t cost the dealer anything at all to do it, it’s literally 5 minutes of typing.
Absolutely, cancel the order, go to another dealer and order with them, you will get your car for £400 less – obvious. I would also report the ‘offending’ dealer to Motability too.??
Just go to another dealer for the lower price, you may end up waiting longer – that is the choice. Don’t try reporting them to Motability because the practice of getting the lower AP is against Motability rules, so it may cause you more hassle than you bargained for.