So, here to add I had/have the same issue. 2017 TRD Premium. Started to peel at about 25,000 miles and two year from purchase. Do not drive by holding that spot, no gloves, cleaning solutions, sunscreen etc. Dealer refused to fix without approval from Toyota (the dps regional manager). Came back, outside influence. No explanation. Contacted Toyota and opened a case. They got back and said same thing- outside influence and not covered. The really frustrating part was the case manager could not explain the process, how, what, or why the decision was made. Only that it was the engineers who looked at it and therefore it wasn’t covered. They looked at a few pictures (Unknown quality or quantity) that the dealer sent. I asked the toyota case manager if they would cover it as a customer service issue, or even offer to partially cover it-the answer was no. Since the engineers has made the decision, that was it. Don’t know if it was one engineer, or multiple.

In the front of the warranty book is a dispute resolution process. I am in the process of following that and the claim is pending. It says only for California in the warranty book, but the information online looks like a national arbitration mechanism/process. I wanted to pass that on.
Also, there is a change.org petition with some signatures-
Petition * Replace steering wheel for free * Change.org