hey Elkaholic, glad to hear you got in touch with a warm body today. Sounds like (eventaully) you 'll get a brand spanking new machine.
My suspicion is that somebody took your machine back to Sears claiming that they 'never had it out of the box', and it got resold as such. I have a friend who got a LCD monitor from buy.com that way, retaped box, scratched on base, etc. They did send him a new one.
Defiinatly try thigns out on cheaper wood. Good pine carves nicely, but can be a bit fuzzy (but it cleans up easy). I have found that even with a lot of CNC experiance under my belt I had to get to know the machine and software.