I don't know how they can do it that cheap. Generally I charge about £60.00 for fitting a new drive, backup and reinstalling but often I can get away with a clone and a repair, which the client usually prefers.
Be careful about checking if the the drive is new, but I there is some very good software which reads the SMART data and will confirm. Not checked for a few weeks but the last I checked it was getting very hard to get hold of drives less than 500gb.
I am not the cheapest but not the most expensive either, but as a guide from that I charge:- £90 inc hard drive for including a OS repair or reinstall depending how bad the old drive was.
£35-£45 for malware related issues depending how bad it is.
With regard to the warranty check what it actually covers, if the drive fails say after 5 months will he fix it straight away or wait till he gets the new replacement drive?
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Dell Inspiron Laptop - Black screen repai.. 
Dell Inspiron Laptop - Black screen repa.. 