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I'm still trying to get past the idea that any significant number of people would rather SELL a broken iPod that was still under warranty, rather than get a warranty replacement themselves.

I return at least a few hard drives that have failed for customers that are still under warranty per year. I tell them they can send the unit back or can pay me a little to send it back. Quite a large percentage of them just give me the drive and don't worry about it.

People, in general, hate dealing with warranty returns. For many items you have to follow pretty specific instructions to avoid your warranty being declared void.

His operation probably wasn't legitimate ("before I could even legally hold a paypall account"). It's not OK but Apple probably could have made his life 'difficult'.

I think he meant before he could contractually have a paypal account. In my experience, this was not hard to bypass as a minor...

Uncle figure grounds.