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It doesn't really matter what their "standard policy" is, if their employee specifically stated to send your old device back to them and they'd send you a new one. If you did what they said, and then they didn't do what they agreed to do afterwards, that's fraud. A very good reason to use chat rather than phone calls, and save those chats.
If Amazon comes back with "That employee didn't have the authority to promise that", then I'd reply with, "Well, it looks like you need to re-train or fire them then. But that's none of my concern. Where's my new PaperWhite?"
"New" is not some vague, blurry impressionist concept. "New" has specific, accepted and legally enforceable meaning.
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