I'm happy to report that I got this fixed and at a much lower cost than I had feared.
There is a guy here in Toronto that is very knowledgable when it comes to lexus. The name of his shop is "T-LEX" . He was the only mechanic that knew immediately what the issue was and even described how to fix it without having to rip off the panel and replace the lock like lexus was suggesting. He told me right away that this was a broken spring in the locking mechanism and when all was said and done this is exactly what it was.
He was able to pick the lock (with window in down position) by positioning a wire in excatly the correct location.
With the door open it was another 45 mins to take off the lock and replace the spring. Taking off the lock required some precision and care because of the plastic moulded parts.
Apparently this happens often and with no warning and unless you are really familiar with the locking mechanism it's difficult to open.
Anyway, 140 dollars later no need to enter from the drivers side and it sure beats the dealer estimate of $1000.