A way for Apple to avoid fulfilling their obligation
I just had the same experience 2 days ago. It's very frustrating! My iPod touch is just 3 months old and suddenly got very sick. It doesn't want to accept any update/restore from iTunes anymore. I sent it to Apple Service for repair. They returned it came back after a week, saying the water indicator turned reddish, indicating a water damage (spill or contamination). I was stunned, like bitten by a snake. How can I dispute their claim? I know I didn't do it! I was mad, very mad. Imagine Apple telling you that you spilled water or wet you iPod but you didn't? Guilty as charged indeed! Not way to defend myself. What if their technician "drooled" on it while diagnosing it, or Steve told them to wet it a little (just little 'coz it's very sensitive) to trigger the sensor to avoid repair bills, who knows!? As a poor customer, I don't have any way to verify their claim. How can I see that sensor? Hmm... bad, bad, bad practice. I think Apple is getting to be a rotten one.
This is a very unfair business practice by Apple, unbelievable. Imagine, if they want to deny repair, they can just tell these things to customers. The "water sensor" I think is baloney! What if they just drop a little liquid there, we don't see them while they diagnose your baby anyway. I believe my iPod has a memory problem, and fixing it will cost them to replace the whole thing. CHOOSE: a DROP of WATER ($0.01) or $200? That's what they avoided. VERY DIRTY UNSCRUPULOUS PRACTICE indeed. They did not trust me, why would I trust them?
I'm trying to get a refund from my Credit Card company for Apple's greediness!