I have only ever seen UK sellers reselling drivers made in China, at least for the hobby market. So you are paying a premium for after sales support and easy return if you buy from here.
ArcEuro used to sell them but I think they don’t anymore. CNC4YOU (?) I think still do.

For the red LED have a read here

http://www.mycncuk.com/threads/3899-Driver-Lights-Red

Switch off the drive and they should spin freely. If not the coils are shorted out due to incorrect wiring. Check which coils you have joined together depending on if you intend them to be parallel or series wired.
Usually if the wires are shorted the driver will pop. At least the older analogue ones did.

If it is intermittent then the coils are wired ok and as you say the drive could be faulty, or in theory the stepper itself could be faulty. You could try swapping drivers over and see if the fault stays with the driver or with the motor.

Another option is to power it up without the motor and step dir connected and let it warm up and sit there. Maybe something is not right and is getting hot because it is faulty.