When you see the project might fail due to some short-thinking of the customer cancel it (but bill for the concept/meeting time, it's not lost to him either). I was hired away from a small midwestern shop to work for a smaller but more successful one-man operation, doing mostly large intranet apps.
About the project i wrote about above: besides the missing integrity of my boss the complete project also was BS and will never take off! It became apparent that I was hired because he accepted far too much work; he had a backlog that stretched two years into the future, and with funding for intranet projects being as "stable" as it is, you know what that means: those projects were in danger of going away, those customers were in danger of walking out. I was to develop a contract and lease management system for a chain of 60 hospitals, a project management and collaboration/document-sharing/scheduling application for a prefab construction company, a personal healthcare records management app, a new call-center product, and take designers' mockups for several public-facing sites from mockup to CMS-driven reality.
I told him it'd cost at least 0k not including server hosting and phone center costs.
I once worked on a proposal for an idiot such as this.
He wanted to build a complete online university, two ecommerce sites, in-store kiosk apps, and a seminar scheduling system, and have it all ready in 6 months.
We went to Stockholm a few times, and then to visit a partner in Iceland, where we planned some more and did flow charts.
But then in the end it only took us a month to do the coding and all the systems integration, and it was a breeze. Few years ago I worked in small company and guy running it didn't know how to read his e-mail, but he would go out and make deals for websites or multimedia presentations.
No preparations where made and no concept work to speak of.
Some designs where pitched to the customer, he agreed, demanded more features, my boss agreed, the designer didn't get it, the cooperations with content suppliers where of the worst kind.
Because some friends had a company that was going under.
I've since quit programming for money, and now I work as a carpenter for 3 months per year and live in beautiful Ecuador for the other 9. I'm currently in a situation similar to this: in a web agency attempting to lead a (too) small team in completing a huge project in very little time.
This is so often not taken serious and "screenshots as concept" are employed.
Have another meeting after you've collected questions that are not clear to you and interview the customer about it(ideally present some solutions).
I've since quit programming for money, and now I work as a carpenter for 3 months per year and live in beautiful Ecuador for the other 9. That sounds like something I'd love to do, but wouldn't. The entire thing is "screenshots as concept" with no real planning.