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This is likely an issue with the cap then. It's machined slightly smaller or larger than the factory cap at the sealing groove.
If I payed that much for a lifetime filter I would expect nothing less than a lifetime supply of o-rings if they won't accept a factory spec o-ring.
I highly doubt it's an issue of the filter housing surface being worn that much.
I can relate with the high dealer prices. We have a dealer near me that charges over retail. Now, to me that is BS. I have NO problem with dealers making a profit. I worked in parts for several years myself at a farm equipment dealer and I know it's part of making money. What really irks me is when places charge OVER retail.
The cap was the OEM cap I got with the truck. It was an O ring thickness issue. I measured the thickness of both O rings and the K&N O ring was slightly smaller and when stretched it even got smaller.