For the mechanics out there, knock sensor Options

[Bargod]

I bitched a bit about this in another topic and I was wondering if anyone could help me out with this.
A while back my wife took her car in to the dealership to have some minor work done, balancing and alignment and an oil change. She also had her fuel injector cleaned I believe as well as an air filter replaced.
Anyway, I picked up the car on the way to work. As soon as I hit the gas out of the lot the check engine light came on (the car also pulled to the left, like it did before the alignment). Anyway, after they checked it out they said it was the knock sensor and that it needed to be replaced. I'm curious if this is something they may have caused while they were doing the other work. The supervisor told me that they were "like fuses" and "just burned out". He also wanted to charge me $400 to replace it.
How much of what this guy is telling me is true and how much is BS?
BTW, it's a 2001 Camry.