My cover (red for iPad Air) is the same way. Bad fit--and several reviews on Apple.com say the same. It does seem to be a magnet-placement issue, not a "breaking in" thing. (Laid on a table with no magnets, it's pefectly flat.)
But they're taking it back with no restocking fee (return shipping paid and everything, or I can take it to a store) so no real harm done. No questions asked--I just get my money back. (I'm keeping the iPad itself of course

)
I do like it a lot otherwise, so I'll try buying again at an Apple Store--but I might wait a few weeks/months first, for them to resolve the problem.
And definitely test before you leave the store! Good advice.
The gap looks cheap and lets dirt in the sides. Plus every time you press on the iPad (carry it) it makes the cover slide so it's flat, and then back again. Constant back-and-forth grinding of whatever dirt has collected on the screen. Not good!
Fingers crossed I can end up with a good one--but if I can't, I still have my $$. Bad quality control, good service!
A question, though:
has anyone had a bad Air cover, swapped it, and had the new cover fit? That would mean the variation is in the covers, not in the iPads, which I certainly hope. But it could plausibly be the iPads. Then it's a warranty swap issue if I decide I want to use a magnetic cover badly enough. (Thank goodness I'm not using Android, then, and my swap will be a true clone of the one I return.)
People saying they tried three covers and all failed is alarming: it could be certain iPads that have the magnets wrong. (And I can well believe that assembling an iPad is more complex a challenge than making a cover.)