Buy refurbished products directly from the manufacturer, so you can get the assurances that they've rigorously tested and rebuilt the devices themselves, or else buy from a reputable authorized dealer (e.g., Amazon, Newegg) that gets the refurbs from the manufacturer.
You can buy refurbished electronics from other places, but you have to be a bit more wary. I'm sad to say my personal experience buying refurbished gadgets has been a horror story, in two cases. At a discount appliance store chain, my father bought me an "open box" television for college (my dad's frugal, and he rocks). That thing could not hold a signal for its life. Naive as we were at the time, we were convinced by the salesman's explanation that the open box label just meant the customers had looked inside the package and returned it right away. When we had plugged it in at the store it worked, but of course it didn't work miles away at college, and the TV was bought "as is." Moral of the story: Avoid buying refurbished products "as is."
You lead the smart life. That’s why you’re reading this blog and that’s why you would never be caught dead paying full retail for a new gadget or gizmo. While there may be some other ways to save money, buying Apple refurbished products could be one of the best decisions you’ll ever make.
The one thing the label means with any certainty is that a refurbished item can't be sold as new. Because of that, and possibly because of the ambiguity of the "refurbished" label, consumers often shy away from buying refurbished products, even when they may be perfectly fine.