I am curious as to how they can"keep the gun" I dont see any legal way they can. They dont own it, you dont consent to them keeping it. I dont care if they found it turned to glass and will explode on the next round. They can inform you as to its condition and not to use it, in writing. They may even be able to do something to render it inoperative temporarily, say remove the hammer. They cannot render it inoperative permanently, say cut it in two. They arent doing you a favor by taking the gun and sending you a new one. They are taking away a future liability and cutting their loss now. Better to lose the cost of a new gun ($500 ?) rather than hundreds of thousands later.

If manufacturers could do this what stops Toyota from taking your car next time you take for an oil change.

As for the owners liability, if you are not the owner of record, haven't received written notice that this could be a defect. You should not have liability of this. The owner doesn't have an obligation to see if there's a recall. However if you did get notice, or can be linked to having prior knowledge of a safety defect, and knowingly sell it with out full disclosure, you might have liability should something occur.

What happens if you sell an old lightweight gun with an aluminum cylinder and the next owner shoots it and blows it up?

I am NOT a lawyer and may NOT be correct!!!

What say our legal eagles?