Hello,
I have the exact same problem. Water damage to my phone. It seems like the phone is functioning fine except for the touch screen. I was wondering if the digitizer is what I would need to replace to fix this issue. Is the digitizer the part that receives the touch input? I know there may be other damage, but I think this is a good start.
I do have TEP, but the stupid thing is they want me to pay a 100 dollar deductible and they would give me a HTC Hero (I think). I think I am going to cancel the insurance because paying a 100 dollar deductible on top of 7 dollars a month is quite ridiculous.
I am available for an upgrade in May, and am using an old Palm Centro now. If I could repair the moment and use it till May, that would be ideal.
Thanks for your input