Sounds like you have the story that you need to feed back to the customer (assuming you have a quote for the inspection).
I would guess they're thinking of the following from 94-9-EC ANNEX VI MODULE: CONFORMITY TO TYPE:
"For each piece of equipment manufactured, tests relating to the anti-explosive protection aspects of the product shall be carried out by the manufacturer or on his behalf. The tests shall be carried out under the responsibility of a notified body, chosen by the manufacturer.
On the responsibility of the notified body, the manufacturer shall affix the former's identification number during the manufacturing process."
I didn't think that the guy making the lid had to conform to the above, but rather the guy making the finished gas detector...but that's what I would guess your customer is reading from. There are a number of requirements w/r/t the manufacturing process amd quality system. I'm guessing that "100% inspection" is shown as a way to avoid alternative quality control requirements. It might help from a certification standpoint if the customer did incoming material inspections vs. you doing inspections at your facility, as I imagine this would allow you to avoid having notified body inspections of your facility and quality systems.