I am not claiming that Schiit followed an optimal course of action, I am just saying that you didn't either. You should require users to ship the faulty units back to you, because if you don't you are leaving the door open for bad things to happen. Nobody will care that you asked the user to return the faulty unit when your name is in the newspaper headlines because something bad happened. Is it really worth taking that risk to avoid shipping? Is shipping really that expensive?
Why not have a proxy in the US and have people send it there, some electronics disposal company that can verify those units are destroyed? That would be extremely cheap for you. It's just a question of applying creative problem solving, and not being lazy.