At 8,000 miles i changed the donuts in my 05. Pipes looked good with a little wear at the point where the clamps sit on the pipes. Noticed some warpage on the pipes as well but no cracks. Donuts where burnt out!
New donuts and back together. Took off on a bagger trip and the sled started to get louder every day. Now unlike you I just kept riding it. Ya it was loud!
When I got home I pulled it apart and the titainium pipes had cracked and broke. Went to replace and the sticker shock on new titainum pipes floored me. Replaced with take off stainless one from guys installing turbos on 03 and 04 sleds. Even reused the the same donuts and clamps on the SS pipes. 9,000 miles later the donuts are still in good shape.
Did your dealer screw you? I don't think so! Mine looked fine but did not last very long after the new donuts where installed. Maybe they where on the edge and ready to go anyway! But I saw no cracks only slight wear at the point the clamps fit on the flanges.
Where they cracked was where the flanges join the pipes and also at the some spots where the wear marks where! As the pipes where warping and creating choke points I was happy to be rid of them anyway.