Well, notice that the answer came in the form of a requirement. The PM just forgot to tell you that one up-front.
Also, your conversation doesn't reflect you asking him what to do. You made a proposal, and he clarified the requirements. He didn't tell you what to do.
I wasn't very clear on my post, but the way you did is the one that works. You go to the PM with an answer, and he says if it's acceptable (or why not). You know how to weight the technical details, he doesn't, he knows about the business details. So your proposal should be reasonable, but there isn't any expectation about any one he comes up with.