I usually have no problem with my demos and stuff being included on DVD's, but I do think the authors of these DVD's should have the common courtesy of asking for permission, especially if they're going to sell these disks, no matter what amount of money is involved.
So what should you then do when this said group does not exist anymore?? let the demos vanish from the face of the earth? Taking charge for the shipping and media costs does not equal selling, since the person who is doing it earn zero profit for the job of transferring the demos to video. Also this would mean that it would be just as illegal to host most of these older demos on the internet for free, as it does not state in the copyright that these files can be hosted on the internet medium. So i guess you should ask these non existing groups for permission for that as well then :-x
The simple fact is that most demos are released in public domain for free, and can be distributed as much as you want as long as you do not make any PROFIT from it.
What about all the amiga magazines with demos cds back in the day? They also released a bunch of PD stuff without asking for permission and alot of people actually bought the demo magazines for the demo cd/floppy disk.
But as i said, i do not know about this particular case.. because $35 sounds a bit much to cover just the media costs, unless that also covers shipping to the whole world.