I am currently creating a bits enabled extension. I am able to set the product prices through the developer rig, however I want to allow each broadcaster who installs the extension to set the product price they desire for their channel for example through the config page.
Could someone explain how this is done? Any help is greatly appreciated.
You need to create a product SKU for each price point you wish to be available, and then you can have your config page list all available prices for the broadcaster to select one.
Completely custom prices set by the broadcaster is not possible as it has to be tied to a product SKU.
Adding to what @Dist said, most of the extensions which allow for selection of how many bits are used have a list of popular amounts. See Sound Alerts as an example of this.