UPDATE:
I get to the dealer at 4pm an hour later than I was told the bike would be ready and have to wait 30 minutes for them to finish putting my bike back together. The heated grips DO NOT work. My bike has been there for 3 days and we have had 80 degree weather (We do not have a A/C in Port Townsend our summers are mild) several of my buddies stopped by to ride I couldn't ride because my bike is in the shop and after three days it is still not fixed.

I was pretty mad when the service tech told me, Jared the service manager was with someone else when I got there and after waiting 30 minutes for my bike I dindn't want to continue waiting and was ready to go. Dale the parts manager did stop by while I was waiting - He has been great to work with in the past so I asked him about the grips. He said that everything is external just as you said TCnBahm, he took me over to the parts department to show me the grips but the only grips he had were 2008 and they are for the drive by wire so they are different. I was pissed and told him that I felt like I was being jerked around, that they had some new tech on my bike that did not have a clue about the heated grips. He said that the grips when they get hot can overheat and it causes the end of the grip to melt and come apart - when this happens it gets lodged into the end of the handlebar. This causes the problem they cannot get the pieces that have melted out to remove the wires and thread the new wires back to the battery (This is why he said the tank was off because the heated grips are home run back to the battery -they are not spliced). I believe the tech did not know what he was doing and instead of f$%&ing something up he was taking extra precaution (and scratching his azz and head trying to figure it out for a whole day or two days..) as to how to remove the pieces.
The service writer told me when I was leaving that they have a service tech -that has changed several of the grips that have had this exact same problem in the past -that will be repairing the bike when I come back in for the repair. They talk as if it is common and to be honest it felt like they were straightup about what happened - of course they left out they put a green tech on the repair and he was clueless when he ran into the problem.
The real bummer is I had a service done at 4000 miles. The oil change etc. When I bought the bike I joined this website and after all the Great Info here I knew that the big eas lean from the factory so I went to the dealer and he recommend the techlusion. I considered getting a SERT but would have had to go to Latus in Portland to feel comfortable and the dealer said the techlusion could be removed with no trace so in case there was a warranty issue so I got the techlusion. The bike had been lagging on take off recently so when I went in for service I told them. They said they adjusted the techlusion and on the way home the bike never ran so well. The notice in power and torque were dramatic. I finally understood what the Screaming Eagle 110 was about.
Well now on the way home the old problem is back. Don't know why -the best way I can describe it is The motor seems like it has to work when I give it the throttle -as if I in 4th gear at 2200-2300 rpm the bike lags a little with the roll of the throttle. This has been corrected when I brought the bike home from the service when I gave the bike throttle it went no lag (of course if I was low speed , high gear, low rpm it would still hesitate) the bike jumped. The power was nice. I think it might be an air adjustment. It sucks though I am going to Portland this weekend and really was getting used to the power and the feel of the bike corrected.
I guess when I take it in to have the recall uh I mean enhancement done they can correct the lag and maybe just maybe fix the grips - I will be getting the heat demons!
I want to say Thanks for all the posts! My wife and I recently had twin girls and my time and energy are mostly on my family but I do appreciate all the information and laughs I get on this site. Sometimes I only have a little time and just view as a visitor but always appreciate the information. It is a great benefit to have all this information so readily available.