This is scary...

Yes, but current practice is on a different level (for those who are doing this) where no movements get repaired at the local service centre, and everything is replaced no matter how large or small the problems are, and it's all sent back to the factory.

Cheers, Al

Just finish this off - I have reached out to some contacts I have in the industry, and people I trust have confirmed that the only thing the watchmakers at Rolex are allowed to do with the Tudor in-house movements is to regulate them. Anything else and the movement is replaced. This will be the plan going forward with the new movement, so not just for extreme damage or during the warranty period, but for paid service down the road as well.

As noted, this is not uncommon in the industry, and I expect it will be more common in the future.

I didn't ask that specifically, but I doubt they are just tossing the movements in the garbage. Based on what appears to be a tiered pricing structure, I'm guessing this is done just like Omega does with the Speedy Reduced movements - there is a base charge if the movement just needs a regular service, but that would go up if the movement has water damage, etc. This implies the movements are being serviced and put back into watches after that...