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A follow-up email from the representative I talked to and to summarize the content:
He indicated that they will offer to me a refurbished Kindle 3g (WITH advertisements) for $104 (which is a savings of $35 off of a new unit). I will have to pay the shipping charges.
HOWEVER, my Kindle 3g does NOT have advertisements.
Again, this was a very courteous person, but I think the 'offer' (let me emphasize that word) is ultimately not satisfactory. I think that if the offer included NO special offers (read NO advertisements), then I would probably take him up on the offer.
Don
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