Microsoft is replacing some Surface Pro 4 with touch screen issues

An update to the Surface Pro 4 on the 26th July this year has been causing major issues for owners of the device, effectively disabling the touchscreen on the device.
Users report the following issues:

• All of the keyboard/pad functions are working including zoom, scroll etc. but no screen-touch or pen response (pen button clicks still open pre-chosen programmes as they should)
• After being shut down will only start up with long hold on power switch.
• It now takes ages to restart (used to start in a few dreamy seconds). Begins with completely black screen for about 20 seconds and no visible signs of turning on (lights on Fn key for instance) then the SURFACE screen, then the ring and eventually lock screen.
• Seems to use the fan more often (it even continued after shut a few times).
• In device manager the Firmware has an exclamation mark on Surface ME saying: This device cannot start. (Code 10) – An attempt was made to change the attributes on memory that has not been committed.
• Trouble shooter detects this but can not solve it.
• The pen/ink section of the Surface App says: the Surface app needs an updated component from Windows Update in order to enable this feature

The relevant thread at Microsoft Answers has more than 600 replies, with Microsoft saying they are actively investigating the issue, but with no resolution in sight.
Now some users are reporting that they are able to get both warranty and out of warranty replacements for their devices by escalating their support call to a manager and quoting the support thread.