"Due to volatility they almost immediately liquidate the BTC at the price it was at when you paid for the device." - not my call what they do with their BTC and how can you be sure of your statement?
Because they use BitPay which automatically liquidates the bitcoins for them. BitPay allows merchants to sell stuff in bitcoins without exposing themselves to the volatility of the bitcoin price which could ruin their business.
"If BTC had crashed to $20 do you think they would give you the amount of BTC back you paid for? I'm certain you would feel ripped off if they did" - not really and still willing to take the risk if they refund me my full amount of BTC. Tomorrow it might fall to $20, right?
Don't be silly you can sell those bitcoins right away at market value. The hardware is priced in dollars not in bitcoins, you just happen to also be able to pay with bitcoins but the dollar price is the actual price and that's what you get in case of a refund.