Can I trade in my first generation Apple Pencil for a 2nd generation Apple Pencil if it’s not compatible with my iPad?

Within 14 days of purchase directly from Apple, Apple will refund the purchase price. Purchases through the online store also have 14 days, though slightly longer for holiday purchases: Returns & Refunds - Shopping Help - Apple

If purchased directly from Apple, you have a generous 14-day period within which you can return your device for exchange or refund. After 14-days, this opportunity is lost.