I took my old 3gs in when it was 3 months out of warranty – it wouldn’t connect to the network; just kept saying ‘no service’.
My advice would be – be a nice person, act as though you have no expectations and be overjoyed when they offer to do stuff for you.
I was surrounded by people bitching and moaning from the start, they got very little assistance beyond what they HAD to be given. I was polite and friendly and got a brand new phone, despite being outside warranty.
They are humans, and like to please people. Give it a go. If that doesn’t work, then you can go medieval on their arses.
They will almost definitely sort you out though, but it might be that they take your phone apart and fix the button, rather than giving you a new phone.
Dave