I also think you should have tried taking the plugs out first and crank it. How were they able to tell it was siezed without taking anything apart? The ski wont crank with water in the cylinders unless you take the plugs out and give it a relief outlet. Worst case you may have bent a rod or something, not a siezure though. Sounds to me like they may be giving you a runaround. JMO
I live within 20 minutes of lbi, hit me up if you have any questions.