Thank you for your post, this is what I expected was the case. The immigration officer told me "I need clarification from the department", and then proceeded to suggest I contact the Citizenship email & telephone, of all places! I proceeded to email them, I'm not expecting a reply though.
In the meantime, I contacted the Spouse of Irish National Unit, again not expecting a reply but I got one within an hour. Their instructions to do the renewal were as per the INIS website - meet with the local immigraton officier, and bring along passports, marriage certificate and proof of address (what I thought). Hopefully that might be enough to get the local officer to do the renewal like she's supposed to.
We could use all of this like a hole in the head now - we're buying a house currently.
In the meantime I contacted the Immigrant Council of Ireland. They said that this can happen (the immigration officier in the area has changed) and I could either complain and ask to talk to the Superintendant in the Garda station citing the INIS website, or write to the Spouse of Irish National Unit and get them to issue a letter to present to the immigration officier. I'm now planning on doing the latter anyway.