There are third party batteries that will puff up and explode. I wouldn't blame Apple for that. If it was an Apple battery, I'm curious which Apple store gave you grief about this. Care to tell?
I noticed the original battery of my 2006 MacBook was puffed up when I was at my parents over Christmas, so yes Apple batteries do definitely have the same issue.
I asked about a replacement and they said they don't make them anymore, but said if I really want one to get a third party battery from Amazon (the guy even searched on Amazon to show me how much it would be).