New iPad being replaced with a refurbished

This is common practice with ALL warranties with ALL companies. This isn’t just an Apple thing. This is how warranties work. If it’s just a dead pixel and you don’t want to go ahead with the replacement then you’re going to have to deal with the dead pixel. To say that your device is in perfect condition isn’t really true as if it were, then your device wouldn’t need to be replaced. They don’t really do screen replacements on iPads, and they do swaps with a warranty replacement. Even if you didn’t have a warranty and you went in for repair, they would still do a replacement at your cost.

I understand that it doesn’t seem right that your device was purchased brand new and now you’re getting a refurbished device, but as stated above this is common practice. Keep this in mind though, you’re going to be getting a device that has been thoroughly tested and made sure that it is going to pass the tests. When devices are brand new, they randomly test units in production to make sure that they are going to pass the tests, they don’t test all of them. When you get a refurbished unit, it has been tested, you know that it has as they have to correct whatever needed to be corrected and then test to make sure that it has been corrected and there are no other signs of other problems.

The battery does get replaced in the refurbished unit so you’ll get one that has less cycles then the device that you are going to be turning in. Unfortunately things happen, and new stuff doesn’t always work the way that we expect it to, this is what warranties are for, and Apple is fulfilling the terms in the Warranty agreement that you agreed to when you paid for the device, then accepted again when you turned on and started using the device. If you didn’t agree to those terms at that time, you should have packed it back in the box, returned it to Apple and told them you don’t agree to those terms and gotten your money back.

Personally I would go with the replacement as I would be totally annoyed with the dead pixel, but if you don’t want to have it swapped, then you can deal with the device in the current condition.

Go ahead and read the warranty terms because that is what Apple is doing - fulfilling those terms:

Legal - iOS Warranty Document Us - Apple

pertinent passage from above link:

(ii) replace the Apple Product with a replacement product of the same model (or with your consent a product that has the same or substantially similar features as the original product – e.g., a different model with the same features, or the same model in a different color) that is new or comprised of new and/or previously used Apple genuine parts and has been tested and passed Apple functional requirements,

Replacing a used iPad with a dead pixel with another and better-working refurbished iPad seems equivalent swap, yes?

The refurbished replacement is what Apple provides in various cases.

I’ve had a few refurb device swaps over the years too, and they’ve all worked.

Your iPad has a dead pixel and a battery with a cycle count of 16.

A refurbished unit will have no dead pixels, a new battery, possibly with 1 or 2 cycles, and a case.