It varies greatly from store to store. Some will process it as an exchange, which they should do for any Nook purchased within two weeks, some will refuse it citing that it's 'not covered by the warranty', which is true-ish, but isn't the way they should do it.
Anything over two weeks is outside of their return window, and while some stores will make exceptions those are actual exceptions.
Why this happens is because it's all in how you read the situation. Some store managers will see it as you not exchanging the Nook, just getting a new one, this results in the 'no, you have to get a refurbished' attitude. Other store managers see it as you having been sold a faulty device and wanting a working one, this results in an exchange.
You can try and push the issue, but most of the time what they say the first time is what it's going to be in the end, at least at that store.
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