All I can say is a Lawyer is going to cost you more in fees than the retail price of a new pistol, completely ignoring the time and hassle involved. Not sure if small claims court would be appropriate for this or not.
I'd say it boils down to how much time and money you have to invest in resolution and what your time is worth to you.
I'd likely just take their offer to get a new one at cost and chalk it up to bad luck. I try to avoid drama if at all possible.