Is this a joke - Apple iPhone & iPad's battery replacement policy

Is Apple battery replacement policy is joke?

When you send your iPad off to Apple, you aren't just getting your same ol' iPad back in the mail after one week or thereabouts. Opting for the company's battery replacement service will basically put you on the list for a refurbished iPad--although the exterior case of the device will be brand-new, the underlying product will be one that's gone through Apple's fix-it procedures in some capacity. Naturally, any data you've kept on your old iPad device will go the way of the dinosaur: You'll want to back up all your settings and information prior to asking Apple for a new battery.

I have changed my Fujitsu Tablet PC's battery 3 times (hey, that is a real tablet while iPad is only a touch sensitive device, just like a checkout counter and stop calling it a tablet because you cannot scribble ink on iPad). And each time, not a single bit of data is lost and it take a minute to replace a battery - not days and complete reload of data.

My questions in relation to this crazy scheme are:
1) How clean does Apple clean the memory & disk drive in this device to prevent leakage of one's data to another owner?
2) How perfect is their back up and restore program in restoring the device that comes back to its pre-service state?
3) How does one reconcile the different serial number or mobile phone's identification number as I am sure they will be different. For example if insurance company will use those number in their policy.
4) Will the device that comes back have different revision of the ROM or chip set? Will you be getting an older version from a newer one that went in?