tdgeek:JarrodM: you should have rejected the PS4 when the problem first occurred and pressed for a replacement harder as per your rights. This is the key
They probably should have classified it as DOA, and just given you a replacement. But then I haven't seen any reports of this problem so it seems rare so I don't think it's unreasonable that they wanted to send it away for inspection.
As for your options now I think having to send it away for inspection and/or repair is reasonable as the retailer does have the option of either repair or replacement. It's reasonable as you had the option of rejecting the PS4 as not being fit for purpose but you didn't so it can't be too unfit for purpose if you kept playing it.
In fact, the OP, while criticising the retailer, is actually criticising the CGA. I feel its fair to say that the CGA is a very good, and fair process.
Unfortunately its let down by the disputes tribunal which is overseen by muppets.
To OP, the sooner you send it off for repair the sooner you get it back. Take a 2 week gaming break and enjoy the nice summer weather outdoors. Complaining and not doing anything only adds more time onto the 2 week window.