So I figured I'd post an update here...
As usual my luck isnt too good. Despite calling apple and them telling me I could exchange it even after ordering it online through verizon, I walk into the store and they said they can't. They are only able to do "in store purchases and online purchases made through the apple store." Of course I was quite angry considering I drove all that way after being told it was possible.
So eventually I was able to call verizon directly and they are sending me a new 32GB iphone 5. And crediting me the 16gb one once I ship it back to them. What's really upsetting is I had to pay a $35 restocking fee through verizon. I'm pretty disappointed that I get penalized for a defect at apple's end. But oh well....