Not sure if this is US only, so YMMV. Not every iPad is included - just those from the last six years, or so. Just pay sales tax. The 256mb Pixel model is more expensive, so will not be free, plus accessories are extra as well. Log in in the upper right corner of the page with your Google account, select Tablets off of the top menu, and the deal should appear if you scroll down the screen a little bit.
Trade in terms and conditions apply. Once the trade in is validated, you will get a credit on the credit card used for the purchase in the amount of the trade in. If the trade in value is greater than the purchase amount, the difference will be a credit on the Google Store.
You can trade in Samsung tablets as well, but the trade in values are not as good as for iPads.
Google Store