Difficult to hear calls in the earpiece

I just purchased an unlocked iPhone 5 directly from Apple. Immediately I notice it was difficult to hear through the earpiece when on a call. After going through all the settings, many times, it only got worse. It sounds like the caller is very far away and I am straining to hear the conversation and I have the volume turned all the way up in settings and also with the outside volume key. I also ran the diagnostics through iTunes and it found nothing wrong. The closest Apple store is 2 hours away. I'm wondering what is wrong, are other people having the same problem, will Apple replace the phone, or what will they do to fix it? Needless to say, I'm very disappointed. The screen also seems to dim and/or fade before the display turns off. Is that normal for IOS 6 and the iPhone 5 or is it also a problem?