Why does it cost the same in Area Bonus to upgrade from Level 1 to level 2 weather is it Bronze, Silver or Gold? They are all 300. Why wouldnt it cost less to upgrade at lower levels with higher badges earned? That makes no sense. Is this a bug? 

Well, I can tell you that I was not consistently doing 1-key UNM before the Live Arena Area Bonuses came along, and now I am.  

I was close to one-key, with consistent scores in the 60s, and the occasional one-key UNM run.  

I took Ignore Def to L5, Speed to L6 & Crit Damage to L5, and now I am consistently in the 80s-90s, with an occasional run over 100M. 

It's as intended by design.  The higher you go in LA the more crests you get per fight so it's working similar but not exactly the same.

What should I upgrade in fire knight 

Speed & Accuracy are probably first.  

If you plan to get hit by Fyro, then probably HP & DEF next.