Very disappointed in Apple Customer Service

I did NOT get my iPhone wet, but the mute switch on the side quit working. It moves like it is working, but it doesn't turn the ringer off. Vibrate still works, but I have to turn the volume down to get the "mute" the ringer. I went to the Apple store to exchange the adapter and thought they would of course cover my phone under the warranty. But found I had to make an appointment and come back to see someone about my issue. So I did. When I returned for my appointment, however, according to the "genius" that examined my phone - one of the moisture sensors had been tripped, negating the warranty. My phone is only three months old - I am the only one who uses it, and it has never gotten wet! But even the manager at the Apple Store - who never even looked at the phone himself - refused to honor the warranty. I couldn't believe it! I have been an Apple user and supporter for 20 years. I started on the Apple IIe. I currently have an new iMac and an older MacBook, that I was planning on replacing with the new MacBook just announced. I bought the first iPhone the day it came out, and the G3 as soon as it came out. I am in the education field, and I have argued with my colleagues for years about the virtues of the Mac vs. PC's. To say I have been a strong proponent of Apple would be a huge understatement. I have heard that as Apple is getting more of the market share, customer service and satisfaction have also gone down, while product quality has also gone down. But I didn't believe it. I have always been so satisfied with my Apple products. I can't believe they have this policy and refused to fix or replace my iPhone. I have no idea what would "trip" one moisture sensor. If it really got wet - wouldn't more than one sensor get wet? And besides that, how could that issue have anything to do with the mute switch on the other end of the phone - even a "genius" could figure this out. Instead of caring about my business and giving me customer satisfaction, they took the "easy out". I am very upset and disappointed about this response from a company that I have supported for so many years. I am only one customer, but a lot of people treated like me can make a difference. I feel like I have no recourse except through this website.