Usually, a full device replacement on AppleCare+ (for iPad or iPhone) will be an Apple refurb, not a true brand new device in box. That being said, Apple Refurb is extremely high quality (much higher than you'd expect from anywhere else, Best Buy, Amazon "Recertified", etc.) - a lot of ppl here buy from the Apple Refurb site to get good savings.
It's so good, you can even buy AppleCare+ on refurb devices, as if they were new. And your AppleCare+ would continue to be in existence on the "Refurb device" you get for the remainder of your term.... so if anything were to go wrong with the refurb device, you still have AppleCare+ on it... eg. vs a lot of other warranties, if they give you a fully new/refurb device, they usually consider the warranty done and fulfilled...