This is getting OT, but I work in the semiconductor industry. I've had access to "teardown reports" and other insider information. You are seriously misinformed if you think a Macbook Pro's total cost of production is $80. To suggest that an Intel i5 or i7 processor would sell to Apple for say, $40, is risible.
My daughter's MacBook was purchase late July 2008 after Apple had determined that there was a problem with the NVidea graphics. However, Apple continued to sell them without notifying the buyers.
My take away from this discussion is that some buyers may have a case of fraud with Apple in that they were knowingly selling defective computers and not telling their customers anything. Now my daughter is in school without her MacBook and out over $2,500 dollars. FRAUD!
The Apple warranty being 1 year or 3 years if you purchased apple care on some products isnt the only warranty you get. Most countries have a statutory warranty that protects consumers well beyond what apple would have you believe you are entitled to. To everyone that has this Nvidia issue.
CONTACT YOUR COUNTRIES CONSUMER RIGHTS GOVENING BODY.
The more people do it the higher the chance it will get sorted out.
The personal computer industry needs to handle defective componets like the auto industry has for years. If there is a known defective part used in a computer they make they should issue a recall and replace the defective part in all their products that use it. Right now they say that only if that part fails will they even consider fixing it. And even then the buyer has to jump through hoops to prove that the particular part failed or by the part failing bricked their computer. The latter being nearly impossible.
Apple could have demanded Nvidia pay for all the MBPs to be repaired that used the defective GPU. But instead Apple choose to protect NVidia and demand NVidia only fix a very tiny percentage of faulty MBPs.
Apple, I am one of your most loyal fans and users. Over the last 6 years, I have purchased two Desktops, two MacBook Pros, one iPad, three iphone 4s phones and a wonderful array of support accessories and additional software. One would think that Apple would cherish my patronage and do anything possible to keep me happy and buying more product. Unfortunately, this is not the case. This last week my MBP experienced the dreaded Kernal Panic attach and even though the Geniuses tried to restore normal function, they could not. I however, was able to reboot the unit and make it function, until I took it back to Apple for their diagnosis. The technician told me that MBP has a main logic board that needs replacing at a cost of $310 with only a 90 warranty. I was told that my December 2007 unit would not qualify for a free repair as it was out of warranty. Coincidentally, I discovered just tonight that Apple knew about this defective main logic board and either did not remember to tell their customers of this defect....or they intentionally did not tell us.
<Personal Information Edited by Host>
Picked up my repaired 2008 MBP at the local Apple store today (Nov 27). I didn't actually drop it off until until previous Nov 20, so 7 day total turn-time including the Thanksgiving holiday is very good.
For the flat US$ 310 charge + tax (total $328), Apple :
- replaced main logic board.
- replaced LED board (didn't even know I had a problem).
- replaced both fans ( I knew left fan was going bad).
- replaced Superdrive DVD (intermittent data read problem I wasn't aware of).
- 90 day warranty on entire computer, not restricted to the repair.
Everything seems to be working well, now :-D
I just wanted to chime in with a similar story.
My MBP 15 inch 2010 i think broke today .
I am in the last year of my PhD, I have no money, I can't replace it or afford to have it fixed. I have identical issues to those mentioned. Most odd of which is I too have just upgraded to Mountain Lion! Concidence, maybe. I know corrolation isn't causation, but it would be interesting to see how many people lost their logic after a ML upgrade.
Update on my story
After calling applecare Germany daily for almost a week, today I received a final answer saying they will only cover 8600 cards. To further pour salt, they told me that I was late in changing a battery and that was the reason the logic board failed. The local service agent told the battery was alright but gave a different report to apple.....not sure whos is to blame but I know that I am now a sad fool for thinking it is a fair world (especially after you've paid >2000€ for a laptop).
RIP MBP, looking forward to new iMac (hopefully that will run longer!)
I might as well chime in on this post as well. I have already stated my case elsewhere. My 2007 MBP started playing up earlier this year so it was outside the 4 year period then. Of course, like most others, I did not know about the NVIDIA problem until I started looking on the boards. I live in the UK but was working in the Mediterranean for three months. The MBP died the first week away. So for three months no MBP (I used the company PC instead). On my return home I contacted Apple in California by email and received a telephone call from Ireland soon after. No go - they simply did not want to know. I took it to my local Apple reseller and ran a test in store. The logic board came up as OK. It went for a more intrusive test with their engineers, for £66, who confirmed the logic board had failed. The cost of replacement (if we can get one) was quoted at £536. I found an independent guy who did it for £450. He also fitted smcFanControl to preclude it happening again. The fans now run at 2900 RPM. I am using it now. Interesting that Apple are only charging $300+ in the US. Another example of the UK exchange rate going wrong. Harsha UB - good luck with the iMac - the hard drive failed on my iMac 27 in May this year. I am presently waiting for my reimbursement after the recent recall. Before that recall, I was £800 out of pocket on Apple hardware failures this year.
The following from Wikipedia explains the failure quite well:
Some chips of the GeForce 8 series (concretely those from the G84 and G86 series) may suffer from an overheating problem. NVIDIA states this issue should not affect many chips, whereas others assert that all of the chips in these series are potentially affected. NVIDIA CEO Jen-Hsun Huang and CFO Marvin Burkett were involved in a lawsuit filed on 9 September 2008 alleging that their knowledge of the flaw, and their intent to hide it. 
One reason for the high failure rate was because of improper selection of the underfill material for the chip. Underfill materials are a type of glue that keeps the silicon die firmly attached to the packaging material, which is where the connection to the actual pins takes place. On the affected chips, the working temperature of the underfill material was too low and allowed the chip to move slightly if the temperature was raised above a certain level, weakening the solder joints by which the die is attached. This eventually leads to a catastrophic failure, although the way the chip fails is quite random. The primary reason for the failures listed above, that allowed the solder joints to literally melt, is an overlooked software problem. NVIDIA's drivers assume that every card is based on a set reference design and the software controls the fan speed, as it should, based on that reference design. However, many 3rd party NVIDIA based video cards and especially laptops (where most of the failures occur) deviate from this reference design and the drivers often set the fan speed far too low, or even shut the fan off entirely. This in turn causes the overheating issues mentioned above, and leads to failure of the chip. The solution is to switch the fan control from "automatic" to "manual" in the NVIDIA control panel, and select a fan speed that can adequately cool the video card, preventing failure.
The result of these failures was a class action lawsuit and subsequent settlement to address problems with Dell, HP and Apple computers. Unfortunately, Toshiba did not participate in the recall process although some Toshiba Forum posters  report that Toshiba has assisted them in resolving the issue.
smc fancontrol is software you can download for free and you can adjust the fan speed setting with it. I installed it after my mbp was repaired in august and have set the fans up to 3500rpm to be on the safe side lol, so this guy never fitted anything on your mbp he just installed a free bit of software to adjust fan speeds. by the way my late 2007 mbp went belly up in august just gone.... 8+ months outside the 4 year warranty apple offer on these logic boards and i managed to get mine replaced free of chardge at the apple store in covent garden. If you are in the uk you have up to 6 years from date of purchase to get a refund/repair under the sales of goods act in the uk. you should pursue apple for a refund on your payout. I bought my mbp directly from apple so they were responsible for repairing it, if you bopufght yours from someewhere othere than apple in the uk then go to this retailer and purseue a refund for works you have had carried out for logic board.