Well, I bought myself one, and then I bought my wife one for Valentine's. They have each been in for service, mine twice. In both cases it happened about 13 months after I bought them
and I was happy I sprung for the service contract, which I hardly ever do.
Anyway, the problem with mine the first time was the hard drive cable was disconnected. I believe there are web sites around that talk about how to do simple repairs like this; you might google around and see. For that matter you can probably buy new hard drives.
Of course your other option is to bitch at Apple and convince them they should honor the warranty. I've no idea how flexible Apple is, but the guy working the front desk at the local Apple store probably isn't the one who's going to make an exception for you.