There are lots of reasons why a dealer doesn't do warranty work including being punitive. Sales guys don't make any money off of it compared to what they make in sales.
In addition, as others have noted are they providing a service or a profit center. Many small dealers don't really do service. The ones that specialize in service will work on anything, warranty or not.
Besides, the dealer in question should have clearly stated why they wouldn't work on it. Then, they would be given the proper consideration of being worthy of future business. That's all on that business. They could have said, "Lance has shown that they don't pay for warranty work, so we don't do work on vehicles that we didn't sell. We will help you find someone who will and call Lance for you".