Hello,
 
As the title said I'm quite confused on the matter.  To make things short I sent my awesome 8800gt since It started loosing video signal randomly for quite a long time until it got worse and I decided it was time for an RMA.  The card would have been 5 years old by the end of this December so I was quite satisfied with the lifetime of the product.  Well, after $25 in UPS charges for a small box ( I live in Puerto Rico) I received an email today saying that the card had physical damage  Rust!  The technician was kind enough to include the pictures in the email and I could see that the screws had a little rust on them and so did the bracket on the DVI ports.  I was instructed to pay $69.99 to continue with the RMA but this is where I'm honestly confused.  Is this even considered physical damage?  I always took good care of this card and cleaned it with compressed air only so rust happening is not my fault, its what happens to metals that aren't treated, as far as I know.  The sad thing is that I was saving to buy a new GPU and use the 8800gt as a physx card but now I don't know what to do.  I only have 5 days to decide this.   Should I pay the repairs and have a card that performs like a 8800gt which will cost almost $100 in the end?  or should I just forget about it and be without a working GPU until I buy a new card?
 
Also, I replied back to the technician explaining my situation, I'm waiting to see what my options are but wanted to get some advice before I make my final decision.
 
So much for playing games on Christmas
 

Well,  I'm still in the process of resolving this.  The technician was kind enough to lower the price to $40 but I find that these charges shouldn't be applied to me considering the original limited lifetime warranty terms that should be applied to me since I purchased way before 2011 and in no way mention rust as part of the physical damage description.
 
Any other advice would be nice. 

Thank you for your reply BioHazardSperm but the thing is that I do not live in a dry environment.  I live in Puerto Rico and the climate ranges from hot and humid to cold and humid, with humidity reaching 80% or more. 
 
I guess I will have to pay in the end since my 5 days for the payment are almost over and I don't want to end up loosing $25 for shipping in vain.  The total amount (assuming I don't have to pay them to ship me the GPU) will be about $65, which coincidentally is the price of a new 9800gt on Amazon. 
 
So far, I'm displeased with the way EVGA uses its lifetime warranty.  I hope at least that I get something better in return to make all this hassle worth it.

Where exactly is the rust? solder joints?

Just use this as a lesson for future dealings with EVGA RMA department. If any product looks worn or beaten up demand a replacement be sent out.