The fees you would charge a large commercial client, especially once you're more established, might be very different from the fees you would charge an independent or DIY kind of client, especially when you're just starting out.
If they're talking about making HUGE numbers of products, though, then this isn't really a indie or DIY sort of project. They could be talking out their asses, though. Still, if they're saying "We might produce a million of these" then you have the right to quote accordingly. If they choke on the quote you give them, then that means they're not really anticipating that kind of success. The problem with taking only a small "per copy" royalty rate, and nothing up front, is that if they only sell those hundred copies, you'd get almost nothing.
It would be crazy for you to count on a big publisher picking it up... if big publishers were so interested, they wouldn't be doing this self-published thing in the first place.