Reader: I was denied a $200 iPhone refund- twice

A reader of this blog- whose email orgin URL as a Stanford University alumni strongly implies high intelligence- writes me after being unable to collect what she was told was $200 refund for paying $599 for a $399 iPhone.
We report, you decide:
Been interesting, this iPhone debacle. Good thing Steve Jobs is a genius, so he can figure his way out of it.
My sister, though, bought an iPhone recently and was told on the phone and in person at the AT&T store where she bought it that she was eligible for the genius Steve Jobs' $200 refund. Second time she appeared there in person (they wanted to close the first time she arrived to obtain the refund so they told her to come back anytime this week) they told her no, she wasn't going to get it.
After arguing with the manager, she went home and called AT&T, which told her to talk to the store manager, the one that had already told her she wasn't getting her refund after two statements to that effect. No matter how she tried, she couldn't get escalated to another level.
Long story short: my sister told the AT&T woman on the phone to pull up her account so she could cancel services and get at least $200 "back" from AT&T. The woman was stunned that my sister ended up canceling $160 worth of monthly services for the 17-month balance of her contract--a total of $2720 in services--because AT&T denied my sister the $200 refund they'd repeatedly stated she was entitled to.
Just brilliant, AT&T!
I'd never use AT&T, anyway, but I just hope my friends who use their service either insist on being treated right--or deny AT&T multiples of the amounts the company rips them off for (13.6 times the denied $200 refund in my sister's case).
Takeaways:
Wonder if things had been different if she went to an Apple - not AT&T store?
"Customer is always right: R.I.P"