Well, the idea is this: I come to your home and give you an equipment upgrade. I give you a new dish and a new set of LNBs on that dish. That equipment now becomes "yours", and I take the old set with me so that they can be recycled. Most of the equipment that you get on an upgrade is free. If there is any charge, that typically is to cover the costs of a truck roll and technician labor.
If you have a legacy receiver that you bought, and it goes bad for some reason, in most cases DISH will ship you a new receiver for free. However, when you get that new receiver, you must box up the old one, the one that you bought however many years ago, and send it back to them. The new one becomes "yours", and the old one gets returned for repair. It's the same difference. Now if they send you that new receiver and you don't send the old one back within X number of days, then they WILL charge you for it, regardless of whether you paid for it 5 years ago or not. They're actually charging you for the new one they sent you, but either way..... All they ask is that you return the bad/old part. It's no different than if we do an upgrade and the part that you paid for is still good, it still must be returned.