I am not going to comment on your dispute with Al Brown, I don't know him or you nor do I know what is a fair resolution to your problem as far as money is concerned. What I will do is offer you some advice on how to use the product you have, especially as you sold your old rack?
Steel likes to rust, no doubt about it. If it was not treated correctly it would begin rusting almost immediatly in the average herp room, especially if there was electricity involved, which there is.
The good news is that this is almost certainly just surface rust (any chance on those pics?). Rather than spend an additional $400 that you have to try and recover from Al or whoever made the rack (as sending the product to the manufaturer for warranty work is not unheard of) you might want to try fixing it yourself.
A protable grinder with a wire wheel will get the surface rust off easily enough, you can then prime and paint it. It sucks that you should have to do this after spending $1200 on a rack but at least if you do it now you can salvage the piece and get some use out of it. I am pretty sure no judge will refund you the entire amount since it does still work like it is supposed to, just looks like crap and is slowly deteriorating.
This is a cheap but fast and permanent fix and you can then at least have piece of mind that your animals are fine while you figure out the finer points of the deal at your leisure.
Good luck.