Math in the "Real World"

Here's some math for you:

Bruno is trying to put tile on his floor. He has a $250 budget, and his room is 10x12 feet. At the store, there are tiles that are 8x8 inches and the tiles are $0.75 each. How many tiles will he need? Does he have enough money to tile his floor?

This is a very typical math problem that nearly any 7th grader will be able to work out. I should know, I teach them day after day the process by which to calculate it.

So here's one way to do it:

First of all, we're dealing with square feet and square inches. We've got to either turn everything into square inches, or square feet.
For the sake of simplicity, I choose inches. Therefore, I have a room that is 120x144 inches (or 17,280 square inches. I've got to figure out how many times an 8x8 tile will fit into that space. That's easy--we divide 17,280 square inches by 64 square inches (the size of the tile) to find out how many tiles it will take to fill the room. A little division problem will tell you that you need 270 tiles. (You can check this by multiplying 270 tiles by 8x8 and coming up with your original room area).
So the answer to the first part of the question is that it will take 270 tiles to cover the floor.
But, the tiles are $0.75 each. Is $250 enough money? Let's multiply .75 by 270 (dollars by number of tiles) to get our total price.
And the grand total?
$202.50
Do you have enough money? Yes!

Okay, so these types of problems are VERY typical in a math class. I'm sure you've all done them. These are the problems we throw into homework assignments and tests and tell students, "This is where you'll see math in every day life!" And we draw pictures, do examples, use unit tiles and desktops to help kids understand how real-world the concept of area is.
I have no arguments against this. It all seems very logical, and simple. It reinforces multiplication concepts, problem solving, and most importantly: working with decimals.

Well. . .today I went to a tile store.

I went to a tile store because I want to tile my room. And I went into a tile store knowing about how much money I wanted to spend, and had a rough idea of how big my room was. I found a tile I liked, it was 20x20 inches and I wanted to know how much it would cost me to buy a tile. This way I, much like Bruno, could calculate how many tiles could fit into my room and if I would have enough money to get the job done.
Seems logical, right?

Wrong.

So, when I get there and ask how much a tile was, I was met with a baffled expression and a price per square foot. That wasn't what I asked! I wanted to know the price of the tile (which clearly was not 144 square inches). That's the only way I can solve this problem! There was nothing in my math probem that told me to convert to square feet and then calculate the price!
I was assured that my way was not the logical way to approach the problem--nor was it how tile is sold in the real world.
WHAT!? They don't sell tile by the TILE!?

So here's what's on my mind.

Why do we tell kids that they will use these things in real life without actually checking how real life uses math? Are my future math students going to one day walk into a tile shop and feel like fools?
This is the same conundrum that I ran into while I was in college. I was so tired of being taught how to teach. . .I just wanted to go out and teach. Because I am pretty sure that college couldn't teach me how to be a teacher.

So, teaching kids all these "real world" ways to use math. . .are we actually preparing them for using math in the real world?