I have to laugh when I read about the prospects of using one of these to power a cell phone. Yes, they last a long time, but the output is dismal. Get back to me when someone makes one that can put out 1 watt. Presently they have outputs in the 100s of microwatts.
I think this is likely the issue. If you set the current using the xxxfire cell the sag in battery voltage may have fooled you into turning the pot a little too much. Then switching to a GOOD battery popped your diode because the good battery was able to deliver its rated voltage into the load.
I don't think they're trying to rip anyone off. I think they were just overwhelmed by the demand for true yellow lasers. When I ordered me 488nm Valkyrie the shipping was fast, the box contained lots of unexpected extras, and the customer service was great.
I have many pair of safety goggles that came with different lasers but I have eagle pair that cover me for my higher power blue and green toys. Hmmm....I need a high power red one o' these days!
My buddy in the lab confirms this is kind of a weird diode. Below 65 degrees F it puts out something very close to a single mode beam, speckle and all. But as it warms up it's linewidth gets bigger and bigger. I'm still looking up exactly what this means but my lab guy says at 95 degrees F...