WOW... That is huge. Well, at least with the crack they wont want to talk you into machining the head but do a full replacement. That is strange though. I would call them and ask them right away about why that would happen. If they forget about the why it will happen again!
For sure, the original overheating problem will have to be fixed. (Which I still suspect thermostat dammit) The guy said they'd have to talk to corporate to make sure they were going to pay for it or something like that. Hopefully they're not trying to find a reason not to honor the warranty. Everything in the engine bay is completely stock. Do have some aftermarket wheels though (boom05)