The downside of a popular gadget selling a lot of units is that a fair number will be returned. This isn't a mark of success or failure; it happens to all gadgets including the Kindle, Nook, a bunchaton of junk ereaders like the Pandigital Novel, and now it's happened to the Kobo Touch.
Ellen Hage tipped me to a new product listing on geeks.com. You can now find Kobo's latest ebook reader for $99. It is shown with a new box and comes with a 90 day warranty. They're selling it for $40 off of retail, and I would definitely say that is a good deal.
P.S. I'm sure someone is going to tell me that the original Kobo has been available as a refurb. This could be true but I've never encountered one until just now when i found it on the geeks.com for $63.