Yeah, Johnny, we seem to follow each other around.

As a Norteamericano, I am burdened by my inability to drive manual transmission vehicles (I know, I should learn, but nobody I know has one -- and it's essentially a useless skill in the USA). Getting an automatic is very difficult in Argentina, but easier in Chile. Still, not everyone has one, and it definitely limits my bargaining position.

Cars are definitely more expensive in Punta Arenas than elsewhere in Chile and that, of course, makes sense. That said, if I drove stick, I'd probably make some backup reservation and try negotiating a lower price upon arrival. I actually had to do this one in Puerto Montt, when Alamo didn't have the automatic car I reserved.

This strategy might not work so well for driving into Argentina, though, because everyone says (not sure it's true) that it takes a couple days for the paperwork (I guess you could drive around Chile first, and then wait to cross into Argentina later).

I think EVERY car rental agency in Chile will charge you to take a car into Argentina because they need the special permit and Argentine insurance. It seems like most agencies charge between $100 and $150 for this (so probably not worth it for a day trip). As you experienced, you can't get into Argentina without the paperwork. A long time ago, I was staying in Puyehue and thought I'd drive across for a nice steak dinner. I didn't know the rules and, needless to say, I didn't get past the border.

Let me know what you find. Thanks.