Bottom part of touch screen on 2nd gen isn't responsive

I bought a used iPod Touch 2nd Gen MC model to find that the bottom part of the screen (maybe 1cm from bottom up) is completely unresponsive. The iPod itself is in great conditon, and it works completely otherwise. I took it too the Apple Store but the guy said it would cost £80 just to have a look at it (I don't know whether or not this guy was just saying that or not, he wasn't very nice). I have the option of sending it back to the seller but I got the actual iPod cheaply and I think I would be hard pressed to find a similar deal. I believe that it's out of warranty. I just want to know whats wrong with it, if i can get it fixed cheaply or whether I should send it back (I don't want to send it back so any other ways of fixing it would be great). I have also tried restoring it through iTunes.
Thanks.

I would send it back.  Aple ill probably fix it (really replace it with a refurbished one) for the price listed here:
Apple - Support - iPod - Repair pricing
You can Google for local places to fix it.  I have US places but from the currency you used you are not in the US.  You can also Google repair parts to fix it yourself but you really do not know what is wrong.  It is likely the digitizer, but could be other parts too.

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