Even Dell does this with monitors. Years ago I bought a new 20.1inch Widescreen LCD, $550 then. It had some bad backlighting problems. While in the 30 day window they will instantly send you a replacement and send the bad one back in the box the new one came in. Well, the 2nd new one had worse backlighting, so I aksed again, the third one was no better, and the placement of the light leaking was totally random like bad quality control and not just the way it is.
Anyway, I hit the 30 day mark, and I called and just asked if I could wait for them to fix this problem and the phone person said they did fix it and I say okay, cool, send me one then. What do you know, they sent me a refurb that had an older build date than the one I had, so how could they have fixed it. And the backlighting was 3 times worse on the refurb.
I was so upset I let the refurb sit for a month while I used the new one. Then suddenly the new monitor just went and died, and thank goodness I still had that refurb on hand. And that refurb is still working today, go fig. the new one was worse :)
(on a side note I never called Dell back and I don't think I was ever charged for having the extra monitor and not sending one back and I just found the bad new one was working again so now I have to good ones)
GOD, how the hell did I type so much. The lesson of the story, refurbs are not always bad. Depends on the company really.
Bonus: MS on the other hand, after my 360 died the first was a repair, not a refurb, and it died after 2 months, then they replaced it with a refurb to speed up the process, that died 2 hours after first use. So the 4th console arrives, another refurb, and it has been at my brothers in a hot room since then where he constantly plays Guitar Hero every day and hasn't failed once. He has it because I got desperate and bought a new console after the third bad one. This story, even repairs can be bad, as what is a refurb but another repaired console.
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