Upon failure analysis, it was decided that water incursion had caused the failure of the unit. This jives with what MikeM had opined about my crossing a road that had a creek that had risen, flowing over it. Water depth was between 6 and 10 inches, depending on the road surface, where I crossed (larger loose rocks).
When crossing flood waters flowing across a road, with submerged rocks from flood debris, the suspension is going to be bouncing up/down. There may be portions of the roadway missing. This up/down action can create a pumping action with the water trapped under the vehicle, forcing it into places it shouldn't go (like the differential vent that all AWD and all 4x4 vehicles have). That is why the owner's manual for my 2013 AWD CX-5 says to drain and refill the differential oil anytime it has been submerged in water (pages 6-5 to 6/6 under "Maintenance and Care").
The CX-5 has class leading ground clearance and suspension travel but, like all vehicles, the ground clearance is measured with the vehicle unloaded and stationary. Driving over larger, loose rocks is doing to compress the suspension causing the water level to rise in relation to the body and creating a high pressure area of water under the vehicle with no where to go. This will happen on ANY vehicle. Even Jeep recommends replacing fluids of components that have been submerged. In your case, the actual failure was not caused by the water incursion itself, but because the water froze due to the fact that the flooding in NW Arkansas was immediately followed by an arctic air mass with temperatures low enough to freeze your differential solid overnight. Anyone putting a can/bottle of beer in a freezer overnight has witnessed the power of freezing water. Your failure is not surprising (I knew exactly what happened once you had described the environmental conditions preceding the failure). This is not a Mazda failure, it is a human failure to follow the very clear Maintenance instructions in your Owner's Manual. The fact that water entered the differential vent in the first place is not even slightly surprising given the depth of the water and the fact that you were driving over large, loose rocks submerged in the floodwater.
The moral of the story is that all of the "offroad" videos you have seen of the CX-5 in mud/water are NOT representative of the vehicle's capabilities, and you need to STAY OUT OF MUD OR WATER! If you do go into mud or water, GET THE FLUIDS CHANGED ASAP!
This is incorrect. I typically avoid water deep enough to submerge my differential because it ALWAYS entails a fluid change. This was true on my AWD Subaru and it was true on my very rugged and purpose built off-road Nissan Patrol 4x4. But all these vehicles are capable of making water crossings, just like the videos depict. The fact that all of these vehicles have this capability, does not imply that you do not need to do additional maintenance. And while some larger Jeeps, Nissans, Toyotas, etc. can ford deeper water without submerging the differential, you still need to drain and refill after submersion. My Nissan Patrol had a "water protect" distributor that protected the ignition system during deeper water crossings and an oil bath air filter with water drain that protected the intake air from water intrusion. It was designed to ford water deeper than the differential. But it still required a drain/refill afterwards. The main difference is it had much larger diameter tires and water that might submerge a CX-5 differential might not submerge the Patrol differential.
The videos depict real world capabilities that may come in handy in real life. But don't for a minute think that such duty doesn't entail additional maintenance responsibilities. Every experienced off-roader knows this and your Owner's Manual doesn't mince words either.
The rear diff is a $16XX unit, and labor nears $1K. Treat it like it's made of sugar, when you're around water!
No, don't treat it like sugar, just follow the clearly stated maintenance requirements. In fact, you are lucky Mazda is covering this under warranty because immediately preceding the requirement to drain/fill the differential after submersion is the following statement:
"To continue warranty eligibility and to protect your investment, it is your responsibility to properly maintain your vehicle according to factory recommended schedules contained in this manual."
The problem with this country is very few people want to take responsibility for their actions. They prefer to blame the manufacturer of a product rather than their own failings. The fact that your much bigger Jeep went through similar water is no excuse. Oh, wait, didn't your Jeep have similar expensive problems before you dumped it? Do you always ignore the maintenance schedule and them blame the manufacturer?
You should be praising Mazda for covering your irresponsibility and ignorance under warranty. And people wonder why cars cost so much! Partly because we all pay for repairs done under warranty, even when it is the owner's clear negligence that caused the failure! I don't expect you to admit this as you are always right and the manufacturer of these amazing offerings is always at fault. You will simply make up more excuses and squirm around the central issue here which is personal responsibility.