T-mobile fails to comply with contract

I have been a loyal customer to T-mobile for many years now and in January I went into the store to express my frustration as more calls were being dropped and text messages were not being delivered and received. THey convinced me it was my phone and then proceeded to sell me a $400 phone. Within the first week I experience problems with the visual voicmail; i went into the store and they exchanged the phone for a new one of the same model.
Shortly after that I was experiencing more dropped calls, more undelivered text messages and no the phone was mysteriously powering off at random times.
I called tech service and they had me do several different things, re-boot, change SIM cards, ect..all to just lead them to mailing me a new phone. I received the 3rd phone of the same model via UPS and mailed back the old one. The same night I had the new phone it powered off and would not allow me to power on until I removed the battery from the back and reassembled the phone.
This was over a weekend so the next week I called technical support yet again. They rebooted the phone and assured me that if this didnt work they would get me a new phone.
Over the next two days I received the same issues ; dropped calls, undelivered text messages and now when people tried to call me they would randomly get a busy signal and then the call dropped.
I called today and at thispoint at my whits end and demanded that they allow me to go back into the store and pick out a new phone. That I didnt want a Behold II because I had had 3 of them and I was tired of dealing with it.
They told me they had to send me another phone because the manufactuer required them to mail me a phone 3x before they would trade it out. But get this; I get whatever they want to give me. I dont get to pick.
T-mobil erefused to give me any compensation for my lack of service and lack of use of service over the past 3 months. They did offer to help me out if I wanted to buy a new phone..ahh how sweet! I get to eat $500 because the manufacturer wont provide a refund only an excahnge. Why would I want an exchange on a piece of *** phone that doesnt work!
At this point I am wondering if its in deed the phone or if its T-mobiles' service? I would love it if King 5 would launch an investigation on this. Its a diservice the consumer that because they sell a defective phone that they hide behind the manufactuer warranty. They have a 14 day exchange policy- yet nothing to protect their customers against the phone defectivness after that 14 day period. I was treated poorly by the Sales rep on the phone. I asked him sincerely if he thought this was fair, and he repeated the manufactuers policy like a heartless robot.
I plan on writing a letter to T-mobile and speaking to an attorney to see if I have nay recourse...but I am curious if I am the only one being swindled like this. Thank you for you time.