Contact iTunes support/Apple support and they might be able to help you with the albums -- I had a similar problem (purchased an album on my iPhone, but the download failed midway) and they were able "reset" the download status.
There is some software available which will allow you to view your iPhone backup files, I have only used iPhone Backup Extractor (Mac OS X), but there are other tools out there as well.
The CSR seems to have quoted you the "standard" new customer price for the phone. If you have been with the provider with a long time, see if you can get a better deal from the Loyalty&Retention folks -- you might find more info on phone related deals at howardforums.com
Good luck...
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