My last communication from Apple Canada iTunes support was on Oct 14, 2009. I was told that I would be getting a refund cheque for the credit in my daughter's iTunes account and that it should take 4-6 weeks. It's now been 18 weeks and no refund. The credit remains in the account. Honestly, I did not expect to actually get the refund so I guess I should be happy that I was correct.
To be clear, a refund is not now and was never my main objective in all this. To answer those who have commented that it's my own fault, that I should have read the T&C more closely and I don't deserve a refund, I agree with you. I'm not running from my own choice or my failure to read the conditions. What I had asked Apple for was to transfer the credit from my daughter's account back to mine (the account I gifted the allowance from using my credit card). That seems reasonable enough doesn't it?. Store credit can only buy music; my kid doesn't buy music in the iTunes store, but I do so credit it back to me and I'll use it. In fact, I actually have spent more than the credit amount on iTunes music for myself since then anyway.
Instead of the credit transfer, Apple offered a cash refund. I accepted that offer and Apple has since ignored their promise. Four months later Apple has failed to follow through on the refund or provide any response to my various inquiries. So that's where we're at.
I still don't have any good answer to the primary underlying issue which is WHY a gift card or allowance credit could not be used for non-music purchases in the Canadian iTunes store. Since Apple originally told me it was due to Canadian law, I investigating that, thinking that it was an unreasonable restriction by the government that impedes my freedom as a consumer. Turns out that is not the case and Apple has retracted that statement. So we're back to "because that's our policy" as the reason Canadians can't buy apps in the iTune App Store using gift cards or allowance credit and no reasonable explanation for why that policy exists.
The Apple-oriented podcast MacCast commented on this story last week and mentioned my experience (go to about 1:03 in the show for the story). This is still an issue for Canadian consumers and Apple is not addressing it. I think now the official strategy is to just ignore it the issue. My emails to Steve Jobs and Apple Customer Feedback were also ignored, just like the promise of a refund, so that seems to fit the pattern.