My question is, if it was Foxconn's fault, why was the iPhone 5 the only outlying device to have such terrible quality issues recently? Conspiracy at Foxconn?
Could be any number of reasons. First, Apple could have higher quality standards or ones that are more unusual. For example, there were a lot of rumors when the white iPhone first came out that it was delayed because they couldn't quite get the shade of white that they wanted. Second, the iPhone 5 could just be more difficult to manufacture for various reasons, in which case they'll have more failures. Third, it could be due to a batch of bad parts from a supplier or equipment troubles on a particular line at the factory. Every now and again there will be recalls for batteries, hard drives, etc.
Wow. Just thinking of the sheer number of defective iPhone 5's is staggering, 5-8 million shiny, new, defective iPhones potentially in a landfill somewhere. Yikes!
I doubt that they end up in the landfill. If anything, they get sent back and harvested for functional parts that just get put back on the assembly line. Without knowing what's wrong with them, it's hard to say more, but it's unlikely that they'd simply toss out an entire phone over what could be a minor defect.