Hi Marky1973,
Okay, here's the facts for you!

If you've bought the item from a UK-based web retailer, then you are covered under the Sale of Goods Act. If not, then you will have problems. I will presume the web retailer is a UK-based company, and this is what the situation is...
1 - The Sale of Goods Act states that, all items must be fit for their intended purpose. (That's not a direct quote, but it is in there!) Basically, the 12-month warranty will cover you, to get a repair only, not a replacement. Sorry.
2 - The retailer can state on their site that they will only offer an exchange or vouchers, which it is their legal right to do so, but technically, it's a bit of a grey area, because that only applies for items outside of warranty or without a receipt or other proof-of-purchase. If the item you are returning, is returned within 7 days, unused and unopened, and in the exact same condition as was purchased, the retailer HAS to refund you in the exact same method that you paid. It's the law!

Also, the company has every right to say that they won't pay for any postage or packing, but they CANNOT charge you a restocking fee. It's against UK law, so make sure they don't do this.
3 - In your case, you should ask for a repair within 14 days. If the retailer cannot promise this, then ask to be offered a replacement item (but not of the same make and model, only because it may be a crummy product), that is at least equal to or greater than the item, you bought. Again, the law states the replacement cannot be of lesser financial value! Make sure you test the product there-and-then, with one of your DVD's that you know works correctly. (Take a disc that has lots of extras on it, or one with seamless branching on it, or is RCE enhanced, to make sure the player really does play the DVD's it should!)
4 - If that doesn't work, and company won't play ball, then tell them you want the name of the manager and will be taking them through the Small Claims Courts (even if you don't plan to do this), and that you will let them deal with the matter instead. Normally, at this point, the company will relent, but the threat of court action is usually enough to get them to do what they should be doing in the first place. Be firm, but polite, and keep copies and notes of who you spoke to, when you spoke to them, the conversation, and any e-mails or other written correspondence too. You may need it in the future.
For more info, just click
here!
Good Luck!
Pooch