Well first, welcome to the forum. I hope we can offer some help or at least guidance on this. I can't tell where you are from so some of my comments will be particular to Audi of America and dealers here. From your description I find it almost impossible to imagine that redlining the engine is the cause of this. In normal driving it is almost impossible to damage the engine and running it to redline will certainly NOT do it. These engines are designed to run at near redline for hours and hours as that's just what Germans usually do when they drive on autobahns with unlimited speeds. These engines have a fuel cut-off at about 6600 RPM so that under normal driving you TRY to go further than that, you simply cannot. Accelerating the engine under load (as in driving not standing still) to redline will be prevented, and no damage should result from this. This all boils down to that you can hardly create a condition with your application of the gas pedal to hurt these engines.
However, OVERSPEEDING the engine IS a potential problem but is VERY difficult to do, and especially unlikely in normal driving. I said normal driving. Some of the ABNORMAL driving events that can happen to overspeed the engine are the following.
Physically creating a downshift into a lower gear when already near redline in a higher gear - this is NOT easily done since the request to downshift would normally be simply ignored by the car - BUT, if you move the gearshift lever to say 1st gear while traveling at somewhere near 60-70 mph, this MAY cause such a downshift and an engine overspeed condition.
Physically shifting the car into reverse whilst moving forward at more than about 25-30 mph - this is perhaps easier to do than the above and potentially MORE of a dramatic risk and real possibility. While the same is true in the converse, that is shifting into any forward gear while traveling 15-30 mph in reverse, is also possible with the similarly bad results - an engine overspeed condition.
All that being said - your description of the event does sound like a blown engine - and I would ask for a MUCH better description of your responsibility in this than "because it's been redlined." There are several modules that record the exact data at this event and you should request them in detail. Also ask for the area service manager (NOT at the dealer) to sit with you and review this data. I would be skeptical of their assessment, especially with that weak a reason. You have more rights than what seem to be given you here and you should explore them further, especially in going to higher levels of Audi (NOT the dealer) representation. There may be more to the event than what's characterized above, but just from that alone, this seems impossible to be your fault...
Please check back in with us and let us know how it goes -
