Ok, good news/bad news. Good news, we are able to return the phone back to the crook store, but have to pay a $70 re-stocking fee. VZW rep told me that they only charge $35. In order to get the wheels in motion, we were able to use his dad's upgrade to get the free phone sooner. We have 11 days to return the phone back to store. Deactivate it, get his money credit to his bank account, then reactive the free Droid. We should get HIS new phone by 3pm tomorrow. The only thing I am not happy about is having to pay $70.
I'd have to say that the Rep "Kelly" was awesome in assisting us with this issue. He went above and beyond to help us. NEVER again will we go to VZW authorized dealer. Their inflated prices are INSANE. Next upgrade we will go through the website or over the phone with Customer Service or through their corporate store if available. Ugh, what a mess!