I bought a bike in NYC from a major manufacturer which has to be considered a lemon. I am pretty mechanical but I never could get the bike to function optimally. My wife bought it through a dealer (surprise b'day present), but it came to my house via UPS. The dealer was much too far away for me to seek redress through a visit. As it happened we moved to Oregon not long after. I soon developed a relationship with a local LBS. I have several bikes I work on myself but parts and bike related chit-chat I usually source through local retailers when I can. Anyway... one day I was talking about my 'lemon'. The shop mechanic invited me to bring it in. After looking at it he indeed pronounced it a lemon and as a dealer for that brand they got me a new one. Brand new. I hadn't even bought it from them.

After a year the frame cracked at the bottom bracket. The LBS again came through for me, and I got another new bike. A much better new bike. The one that broke was no longer made and its replacement was much more expensive, not that the broken one was cheap. I will share the name of that brand with the o.p. if he wants, but really, they are not the real angels in this story, nor is Cannondale the real villain in his. The LBS is the intercessor between the corporate monolith manufacturer and the end user cyclist. They have a lot of influence in outcomes. I have to agree with another poster that there seems to be an unusual amount of unwillingness on the part of this LBS to really go to bat for him. There is more to this story than we are getting from just one side, I think.