I think the real problem is NASA's insistance on using the 5-seg SRBs and J-2X upper stage engines from ARES. They LIKE for projects to have both expanded scope and budget, and looks like the Congresscritters are really going to play hardball with them over what is in the law. IMO, NASA is doing what they always do, try and get more money to make a bigger rocket than what they were asked to build. Of course, no one really knows for sure exactly WHAT they will be launching with this thing either.
There is nothing in that law that requires the to use the designs they seemingly have thier hearts set on (see above), so it's time to work with what they have and make this thing work in the time and budget alloted. If they can't handle a 70-100MT to orbit, then there is no way they can be trusted with a true planetary scale launcer of 130MT. Time to get busy NASA, tick tock, tick tock...