OK, I don't mean to be anal here but the web site (not a CSR) has a chart at this link for the extended warranty:
http://www.dishnetwork.com/content/products/warranty/ext_warr/index.shtml
The bottom line says that if you have the extended warranty you pay $46.93, if you don't you pay $64.94. Nowhere does it say that Dish is going to replace a defective piece of hardware for free (you need the $4.99 plan for that).
We all know that CSR's don't always know what's up at Dish and recent policy changes. I have a friend at work that's interested in the 322 and 522 on the DHP. I told him about the documented phone line requirement. He called Dish to get some further information and asked about the phone line requirement and the CSR said that you only need a phone line, even for the 322/522 if you want to purchase PPV via the remote.
Now if I'm wrong about this please point me to the place on Dish's web site that says for $1.99 per month you'll get an extended warranty where you do not pay anything for a repair (except for shipping).