No, they didn't do the best they could.
Sears will only give us $719.99 for a natural gas tank water heater. It has to be a tank. One of the Associates tried locating a gas tank that fits the height restrictions and they found none.
We would be relieved if Sears put that $719.99 and lets us use that to buy a tankless electric heater. My dad was saying something about splitting the difference.
But no, the extended warranty does not allow reimbursement to be used towards a tankless water heater.
My dad is hard of hearing and most of the time he talks, he is shouting. He doesn't mean it. He taught me that you have to do things like this once you get a family. So I guess if Sears isn't honoring their warranty, he has a right to be pissed and angry.
This is a learning experience for me though.