This isnt an uncommon practice... Here's how it works at tractor supply, atleast it did as of a few months ago when I quit to go back to school:
Someone returns something
1) The store gets credit for it, writes it off, destroys it, and chucks it in the dumpster
2) The store does NOT get credit for it, so they (we) clean it up real nice in the back room, rebox it and put it out on the shelf, again for full price.
If someone really b*tches, the manager will take 10-20% off, otherwise someone re-buys it, walks out with it and we never see it again. lol.
If it sits for a few months and no one takes it, then we'de mark it down 10-20%...
You'd be amazed at how often people buy used things and don't complain about it... In fact, the whole time I worked at that store, I can't once remember someone returning something because it was used when they bought it new... But to be fair, the store probably lost a few customers over that practice.
Oh well, wasnt my idea *shrugs*