I think the number of hammers produced by an engineer is affected by some combination of the current age you're in, the number of turns passed, and possibly a random factor as well. In general I've found that it tends to increase slower than the cost of the wonders, so I can rarely hurry a wonder from scratch after the late industrial age. 650 shields is still a very substantial number of shields and in fact I'm sure it should be less than that with stone. Notre Dame can't possibly cost 1300 shields normally given how early it appears, the modern wonders only cost 2000. Seems like the problem may be with it not recognising your stone, not with the engineers. I could believe the Taj Mahal only cost 600-700 hammers, but to be honest I can't remember.
(Apologies for random interchanging of the words 'shields' and 'hammers'. This is by far the most difficult change to get used to from Civ 3!)