MacBook :: Apple Refuses To Replace Swollen Battery?

My mom noticed the other day that the battery on her MacBook (purchased May 2008) was swollen (pics below). Due to this, the battery will no longer lock in place. The trackpad button will also no longer click, as the battery is pushing it up from the inside.

The one year warranty expired 4 months ago, but I was fairly certain that Apple replaced/fixed things that were widespread issues (I know, I know, I told my dad to buy the AppleCare but he never did). Swollen batteries in MacBooks were recently recalled, but apparently this MacBook was not one of the ones recalled.

The folks at Apple told me that it was an old battery issue, meaning the battery was at the end of its life. Normal. That it was simply time to buy a new battery. Now, I don't know much about laptop batteries, but I know for a fact that the swelling isn't due to a dying battery. My mom keeps the laptop plugged into an external monitor nearly all the time, and rarely takes it anywhere. The battery has had 31 total load cycles, standing at 98% of original capacity.

They refused to replace it because the computer is out of warranty.

They recommended buying a new battery before it swells more and causes any more damage. I expressed my concern over the possibility that the battery might explode (an issue common with other swollen batteries). I was told "it is a possibility".

Here's my question. If products produced between months C-D warrant a recall due to a certain issue, and a product produced in month E has the exact same issue, shouldn't it be replaced as well?