As above you can sometimes buy it back. This saves the insurance company disposing of it anyway so it's a small win for them. But yes make sure it's not classed as anything more than a statutory write off or you won't be able to register without getting engineered VASS cert etc.
You can indeed choose where it's repaired unless stated otherwise in your insurance PDS, and entitled to obtain alternative quotes. They have the opportunity to dispute in VCAT or your state equivalent, as do you.
However if they are claiming it is too much money to repair then it's unlikely they will sell the wreck for a lot (can't have cake and eat it too) so you can argue that they have deemed it worth fk all and good cause for you to take it off their hands for cheap.