Iphone 4 stuck in recovery mode, sleep button not working and Apple not helping

Question

Hey Apple Community,
My iPhone 4 has been caused me a lot of frustration in the past week and after getting rejected from Apple Customer Service I did not know where else to turn. Sometime in January my iPhone 4's sleep/wake button stopped responding (it seemed to have gotten stuck) and in my initial call to Apple I was told there was nothing they could do for me even though I was within the 1 year warranty. I figured I could live without locking my phone, it wasn't that big of a deal to me so I simply ignored it.
However, just a few days ago my home button started being less responsive and this was clearly something I could not manage without. It was acting odd, sometimes it would work on the first try and sometimes it wouldn't do anything even after 4-5 tries. The worst part was it would automatically go to voice control even when it was sitting in my pocket. This of course caused me quite a lot of embarrassment since voice control would activate in the middle of my lectures sounding a chime and would dial a random person's number and I would open my phone to hearing someone calling my name. No fun indeed. I called apple about it last week and the nice agent told me that he had waved some sort of a fee to talk to me, I did not know I was required to pay to recieve basic customer support. He also said since I was over the one-year warranty by 7 days and because I do not have an Apple Care plan there was nothing he could do for me besides offering me a refurbished iPhone 4 for $150 as a replacement. I said thanks for the offer but that isn't exactly solving my problem. Since Apple comes out with a new phone every year and being an Apple geek I stay current with the new technology - the Apple care plan just doesn't suit me. I protect my phone in the best of cases and I have never damaged a product due to negligence, I'm not a kid anymore so I don't need to insure my products for my own stupidity. 
Well just in the past few hours the demon iPhone went from making random calls to showing me a "Connect to iTunes" logo. I figured it had to be reset due to some software probelm (which meant I might not have to fork out $$$ to get the home button fixed), I gladly connected it to my laptop and now it wont seem to leave recovery mode. I have tried numerous times and it seems to complete recovery and then tell me to connect to itunes again. At this point I feel like I have lost my phone (and everything precious I had stored in it).
Of course as a business professional this is quite a set back. All my contacts, all my pictures and scans of products and documents and even the little notes that I kept on there to help me function - all gone. I haven't called Apple yet but since they were unable to help me before I am assuming there isn't much they can do now. I do not want to pay $29.99 to be able to talk to someone who will tell me I am out of luck. I am about 130 miles from the nearest Apple store so the Genius bar is out of the window. So in a last attempt to salvage this expensive piece of technology I turn to you Apple Community for suggestions. I was not able to find an email address for customer service or any method of communication to someone who could just hear me out and give me a reasonable excuse for why Apple cannot do anything for me.  I always heard about the great customer service of Apple but I am surprised to see a product fail before my eyes and the manufacturer simply refusing to accept responsibility; all because I am 7 days too late. If I had dropped it or damage it through some programming experiments then I understand Apple refusing to do anything but this case is very disappointing.
I would sincerely appreciate any advice and apologize for writing a novel here, I wanted to present my case in the fullest of details.
- Raza

Answer 1

I had the same issue (stuck in "Connect to iTunes" logo mode) and looked around for a resolution.  I didn't find an answer posted anywhere.   I ended up holding down the power button and the home button for about 20 seconds before it finally came back and said I had to restore it.  Once restored, everything is fine. 
My problem was caused when I accidentally closed the iTunes window when I was updating the software (I meant to turn off the volume as a song was playing, but clicked on the window close button instead of the pause button).  I tried holding both buttons for the recommended 10 seconds several times and it didn't clear the problem.  Holding both buttons for a longer period of time did the trick for me.
I hope this post is useful to others.