So, I know some of you were wondering what the outcome was...
The seller finally heard back from Bikemania and they told him since it had been a year since he bought the frame, he would have to deal with Soma (Merry Sales) directly. Well, at this point I really didn't want to be involved anymore as I had an unrideable frame and a bunch of parts waiting to be put on something. So, I explained this to the seller and he said "no problem" and said he will return my money.

Also, Bikemania took forever to respond and only did so at the sellers prodding...beware.
BTW- when I was taking the frame apart last night, I got my flashlight out to have a look inside the downtube... I found a tiny hairline crack on the inside of the downtube, so it is truely a crack and not "slag" as some suggested (and rightfully so). I'm just really glad I didn't take a hammer and chisel to it!
So, I found a Salsa Las Cruces cross frame off another forum that I'm looking at...hopefully this will be better.
Chris