Apple Care: Resolved
Well going to the Apple Store did the trick. I guess that is the real difference between mailing something and talking to a real person. I do have to give the online service some credit, when they received my ipod there was a pinch of metal that had separated from the top by the WiFi plate. If they had seen that they would have good cause to think I'd tried to open it. And since it was over mail they couldn't just ask me like the nice lady at the Genius bar.
The weird thing is I have no idea where that bent edge came from. I'm actually 95% sure it wasn't on my iPod when i mailed it to Apple. I even took the time to look over everything before I sent it because I didn't want them to find something silly and reject it. I do know one thing however, wherever the bend came from it wasn't because my iPod was opened. So even if the evidence was against me, I truly was eligible for a fix/replacement.
Yesterday when I found out they had rejected my iPod I must admit I was pretty mad. While I haven't babied my iPod, I haven't done anything out of the ordinary either. I haven't dropped it or anything like that. Sure I kept it in my pocket without a case and the screen was slightly scratched, but I did nothing that should cause it to stop after 8 months use. Not only that, I had spent the extra money on AppleCare because I had been burned with an iMac dying just a few months after it's complimentary 1 year warranty. To find out I had spent my money on AppleCare and wasn't going to be taken care of really annoyed me.
My trip to the Apple Store went well though. It was a good 3 hour round trip, which is why I didn't want to go there in the first place. But if you take out the travel time everything went great from the moment I walked in the front door with a broken iPod till the moment I walked out with replacement model.
I'd like to thank the nice girl Genius who helped me out. She did see and ask about the separated edge, but when I said I had never tried to open it she said she'd take care of me.
All in all I'm pretty happy with the experience. I wish the mail in thing had worked because that would have saved me 3 hours of time and a few gallons of gas. However I can't fault them too much because the iPod did look suspicious. I spent one day frustrated over that misunderstanding but am now quite satisfied. AppleCare pulled through. While I hope I never have to do business with them again because I don't want my stuff to break I won't dread the experience if it comes up.