How? What happens when students start buying faulty hardware to justify unrelated delays?

Yes, although just having the faulty hardware isn't enough. They also have to use the tools to show that it behaves incorrectly, which is surely a lot more work than just following the book would have been. That is the part that is easily reproducible. The student already knows how, so in a few minutes he can set it up in front of the prof and show him. The prof needn't do anything other than watch for a few mins.

If more of these cases crop up then you should get suspicious, but you also need to consider the impact of giving a student the wrong chip and expecting them to succeed! I think Blackstone's Ratio should apply here personally

As a teacher, my first rule is, be kind. Sure, there are people who will take advantage of the situation, but they are not really taking advantage of me.

In this case, I'd have a harness that ensures the parts they were given work as advertised, and make it the students' responsibility to report within the first 3 days if it is not working.