Could the whole thing have been handled by B&N better? Yes. Even a message on his Nook that said - "For your protection, we have suspended this Nook account due to suspected fraud. Please contact Customer Service with your account information" would probably have gotten things off on a better foot, rather than waiting on hold, being quizzed, etc.
However, given that the OP said he hung up and threw his $259 Nook, I suspect that there was no resolution that would have made him happy
