I have bought over 20 items from them without a hitch!
I thought I had a bad AVR, and after they had me do some routine checks (to make sure I didn't do anything too stupid in the setup) I ended up with a replacement within a week at no extra cost. That is fair.
I am somewhat embarrassed to admit the second AVR exhibited the same behavior, which led me to look into it a bit deeper and it was "user error" on my part - "oops"!
IMHO, their return policy is fair; however it is not the "satisfaction guarantee" of many places and you can expect to pay shipping unless the item is defective! They are obviously going for supplying reputable gear at the lowest price available, so it makes sense that they would avoid the extra cost of a SVS type return policy.
LovintheHD is the only guy I have read of who received a defective item.