WH Smith are the retailer and are dealing with the faulty Glo, they aren't trying to palm the OP off to the manufacturer. It's just that the individual store can't replace it there and then, they have to return it to the WH Smith head office for replacements or refunds after the first 28 days. It's not ideal as you'll have to wait longer, and is one of the reasons I'd always look at buying a Kindle over a Kobo/Sony etc, but that's just down to Amazon being able to offer superb customer service and there's not really anything wrong with what WH Smith are doing, I'd say it's pretty standard.
moffattm I've no idea what the laws are like in practice in New Zealand, but I know here in the UK the "goods lasting a reasonable amount of time" is a factor too, but it's always an awful lot easier to get items fixed/replaced under warranty (one of the reasons John Lewis is such a highly rated shop is that they offer 2-5 year warranties on most electrical items, the 5-year guarantee was exactly why I bought my TV from them). You usually have to fight for it after the standard warranty.
With e-readers the most common failure I'd guess is the screen, or battery, and after two years I doubt you'd have much luck getting anywhere with a replacement because of either of those issues. Amazon might offer some people a reduction on a refurbished e-reader in these instances outside the warranty, but they are the exception.