Sorry this happened to you but this practice is not uncommon. Many repair centers for retail brick-n-mortar stores as well as online stores indicate in the return / repair policies similiar language. Most reserve the right to retain, replace or use re-conditioned parts involving the repair of a consumer device. Usually this also means that they reserve the right to keep the replaced part. It is a tough lesson to experience.
It has been mentioned on the Buzz Out Loud podcasts many times..."never never leave personal data on a device if you return it, sale it or replace it". They have also stated on many Buzz Out Loud podcasts as well "to always back up your hard drive".
I am really sorry this happened to you but perhaps your experience will be a lesson that can be passed on to others in the forum.
My PowerBook G4 was getting really slow to boot, so I treked 30 minutes to my local Apple store where it was diagnosed with a failing hard drive, which I asked them to go ahead and replace.
Picking it up a couple days and $250 later, I asked for the old hard drive back since, like most people's hard drive, it had all my financial info in Quicken, some work data, lots of passwords, etc. I was told that Apple always kept old parts and it couldn't be returned, even for non-warantee repairs.
After pushing my mouth closed with my hand, I asked for the store manager, who pointed out the fine print on the back of the service order which stated that by letting Apple replace my hard drive I was giving them permission to not only keep the old drive, but to also resell it as they see fit.
According to my math, I've purchased two drives but now only have one. By signing the service order I appear to have allowed Apple to steal my hard drive and all the data on it.