What is B grade hardware?

It's usually returned and refurbished stuff. Sometimes it's things returned in an incomplete state. Sometimes it might be demonstration models after they've served their use. For the most part they'll come bare, no special box, no manuals, cables, software, etc. There'll be a limited warranty. It's all tested and working so for some people buying B-grade just means getting a deal. :)
 
It may also have a tendency to hum and try to move towards brightly coloured objects.

Or is that Bee grade? ;)

As Billytheimpaler says it'll be stuff that might have a damaged box, missing non essential parts (usb backplate/driver disks for example), ex display, or may be a repaired unit back from the manufacturer.
Either way they should work, and you get a limited warranty with them, so as long as you don't leave them sitting around for ages before testing/using them there shouldn't be any problems.
From memory (and what i've heard) some B grade stuff is complete and unused, just the packaging sometimes gets damaged.
 
Does it even have to be an incomplete item... I would imagine that most items 'returned' under the distance selling act end up sold on as 'b' grade items. If I recieved a 'new' item where the packaging had 'obviously' been opened, I would not accept it.

Look at LCD panels.. people return them because there is a dead pixel... so you get an LCD screen where it has been repackaged, and the odds are you got someone elses 'rejected' screen.

There are normally telltale signs when a package has been opened.
 
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