I think people would be okay if they actually honored cleaning products they ship out as refurbished. If something is refurbished, I expect it to also be cleaned in the process. They could as easily sell an item "as is" if it's never been opened up.
The prices they set is kind of an afterthought. The focus is more on the idea that they sell items as refurbished, but never refurbished them. I think what's happening is that they get a used item into their store, test it, and if it works, slap that warranty sticker on it and sell it as refurbished. So they can in turn also set a higher price.
If they were actually refurbishing these consoles, I wouldn't care. The prices are one thing, but lying to your customers about what they're getting, is not a good look.
They thought no one would be wise enough to open these consoles either, but YouTubers did exactly that and outed their scam. And they can't come out and say they're sorry for these problems, because it would show they knew about these consoles not being cleaned or even refurbished. So they have to play along and keep denying they did anything wrong. I hear it could also open them up to a class action lawsuit if they were to come out apologizing. Hopefully they correct these mistakes and sell actually refurbished & cleaned consoles going forward.
The prices could use some work, but there's not much you can do about that. It's their choice and they have a right to price their own way.