You find that request reasonable? UFC do not need M1, it only really benefits M1, UFC were not willing to give them that for just 1 fighter.
Its totally reasonable that a Russian based MMA organization, that have spent years growing their own regional shows, would want co-promotion in their own home regions. Getting Fedor would have given the UFC a huge leg up in asian exposure = something the UFC very much needed at the time.
Nobody from M1 suggested the UFC should co-promote with them in US or European shows. But if they had Fedor fighting in Russia, you are damn straight the UFC should co-promote. There really should be no argument.