I remember one of my friends had the same thing happen to him, but what he did after getting the runaround at the local DMV office was write a letter to the Office of the Director with a photocopy of the postmarked notice envelopes. He got a reply back a couple weeks later telling him that his penalty fees were being waived.

More recently, another one of my friends ordered a personalized plate and the spacing was messed-up - he ordered one word with 5 characters and wanted it centered on the plate, but when he got it, the lettering was justified right. He was told at the local office repeatedly that he'd have to pay again to get it corrected, so he also wrote a letter to the Director and subsequently got his plates redone as he wanted for no charge.

Power of the pen, I guess.

Even though they've changed the waiting procedure at the local office, I still avoid going there like the plague. The thing is, people are FINALLY learning about making appointments around here, so the backlog is now usually 2-3 weeks for the first available appointment slot instead of 1-2 days.