IPhone 4 catching fire and lack of support from Apple?

On Saturday when I was charging my phone I noticed a burning smell and immediately ran over to my iphone and pulled out the charger cable which was glowing red and smoke was coming from both it and my iphone 4. My phone although slightly fire damaged in the charger dock was still operational, however, when the battery ran out and I tried to charge again on a different charger it would not recharge. I took my phone into the apple store (Toronto Eaton Centre, Canada) and received terrible customer service. The 'genius' took maybe 5 seconds to not listen to my complaint before running off with my phone and charger and then coming back with a new handset and cord and asking me to pay for the replacement. I have since spoken to the manager of the store who was equally unhelpful or concerned about the issue and informed me that he couldn't help because they have since lost my old handset in the apple warehouse system.
I am not only concerned that my current handset could now catch fire, but I am also concerned at the level of disinterest from a company about what is clearly a dangerous fault. What could have happened if I was asleep when it was charging?
As a consumer, this is my first apple product and I had been looking at buying a macbook very soon, however following this incident where I have been penalised through no fault of my own for using a dangerous handset. Then the total lack of concern, apology or interest demostrated by apple has put me off ever using apple products again.
I would urge others to be very very careful when charging their handsets as this could have been a lot worse. If your phone is damaged certainly do not expect any support or assistance from Apple.
Regards
Colin

The iPhone was out of warranty.
It has suffered physical damage.
The Genius Bar staff evaluated it and found it and the charging cord non-serviceable*
The customer was presented a price for OOW replacement
Customer declined, and decided to escalate to a supervisor.
These are pretty much the only facts at play here. The rest is emotion and speculation. The asterisk is for this. You'll have to trust most of this, including the fact that I have a few credentials in Public and Occupational Safety
*If the iPhone was considered a safety hazard, it was very likely placed in a fire-resistive environment. Once it goes in, taking it out is a very serious matter that involves the safety of personnel, the building and other occupants. During the escalation, chances are very high that the iPhone was disposed of according to safety protocols. To have given it back to the customer would have been a serious liability issue. The iPhone wasn't "lost," it was neutralized.
If the customer does not want the OOW replacement, the Apple Genius Bar management or staff is unikely to hand him/her something that could be dangerous or volatile. It would be irresponsible to do so.

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You have not replied in full.
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Hi Destiny
Thank for contacting the Apple Online Store. I hope you are well. How may I assist you?
I placed an order for 2 iPhone 5s
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I have an iPhone 5, so the 5c isn't attractive for me
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ok, thank you.
You're welcome. I apologize for the confusion.
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This is all, thank you. I will cancel my order.
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yes
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