Similar issue with my old GRDIII years ago - lens would extend and make a clicking noise but never would take a photo. Eventually it would display an error and shut down.
Issue was sand. I know for certain it got a bit in it a couple days before it began acting up and it was my carelessness - not saying this is the same issue but the lens mechanism in mine binded and had to be replaced, which I did about a year later in Sydney while traveling, for around $350AUD... expensive but half the cost of a new on at the time.
Most retractable lens cameras like these are very susceptible to crud getting into the inner workings. The price of compactness. I've never used my current model GR on a windy beach and I store it in a sunglass pouch (when not in a proper case) to minimize the chances that sand or debris can find its way in. I'd be curious to know what a technician's prognosis for your specific problem was but sounds like we're not going to find out. Sorry to hear about your misfortune nonetheless - I can relate completely.
edit* It is also worth noting that "quality control" is hardly at issue here. There is certainly a fault or malfunction but "why" is the question. And seeing as there are small handful of people here in this thread and one other, all but one of whom are "new members" who came just because of problems.... well if it were truly a quality control issue we'd see many more posts from the many regular users here on PF. (This still doesn't mean I don't sympathize... because I have a lack of 350 dollars that says I do

)