I think DKeithA meant that Apple will only repair BTOs and not replace them with a brand new mac, unless they are DOA.
I think this is probably true, although Apple tend to try to repair macs anyway instead of replcaing them, unless they are only a few days old/have a major problem/have recurring problems.
As far as demanding a new mac when yours might need a repair for more than a 'simple problem', what sort of problem would cause you to want a new replacement instead of a repair? This would obviously costs Apple money; they have to give you a brand new replacement, repair your machine anyway, and then sell it as a refurb - overall losing about 20-40% of the cost of your Powerbook as new (refurb discount).
Concerning BTO, if this is the most affordable way to customise a Powerbook to your needs then get it. If it breaks and Apple will only repair it and not give you a replacement then so be it. You will end up with a working Powerbook.
Chances are it won't break down anyway.