I understand the great $$$$$$$$ you can get from a relatively new phone being traded in....they "refurbish" it and sell it at a profit! I do wonder though what they do with "older" tech that can only run 32 BIT apps, and nobody I know would even come close to paying what the OEM's are giving for them? Are they selling them to 3rd world countries at a loss? I doubt that! Maybe they are stripping them down and using the parts for something else? Maybe they are melting down the rare metals and selling them? Makes me wonder!
Many get donated. Even an old phone can still call 911; and they can still make phone calls and text. Pretty much any phone made in the past five to six years will still operate on current networks. Our 5G networks are backwards compatible with 4G/LTE devices. It will be several more years before those phones will not be able to connect to a network.
For the devices that don't work, yes. they tear them apart and recycle what they can. I said in another thread, all metals are 100% recyclable. Most glass is recyclable; silicon is recyclable. It is plastics that are challenging. Some types of plastics are much harder to recycle. Technically, anything manmade can be recycled. It is a matter of how easily it can be recycled.
I've been going through my old stuff and taking it to Best Buy and dropping it off in their recycle bins.