@UniqueMixture: I guess it seems fair to think, if someone has just told you that they're "devastated", that they feel bad about the situation.
I'm not saying everyone reacts like this. The majority don't. It just happens more often that I would have expected.
Anyway, even if they didn't feel bad (which I would sincerely find bizarre under circumstances that I've described), it just seems like "I'm sorry" is a fairly generic way to express that you feel for them and would like to help if you could. The dreaded "I know exactly how you feel", now THAT's something I would never say. Because I don't, and can't.