I had some $70 Grado headphones plugged in and was running (stupid me, I learned my lesson) upstairs. I tripped over the headphone cord and fell down. The headphones, 2 days old and a Christmas present, were damaged and the jack connector seriously bent beyond use. I sent in the headphones (I didn't lie, but told them the truth), and Grado fixed them for free. But the worse thing was the headphone jack on my Macbook. Unusable. I took it in, and they said accidental damage was uncovered. The Genius said I would have to pay for an $800 logic board replacement. When I told him of my plight, and how I'm a poor college student, then he told me if I bought Applecare, he'd replace the logic board for free. I had already wanted to buy Applecare, but hadn't gotten to it, so it worked for me.
Nowhere do I understand why the Genius made the deal he did, but it worked for me. 🙂