Well... If your good at disecting and fixing things yourself, then I would recommend that first...
I like tearing things apart to fix, or just to see how they work..
And if your good at fixing things yourself, is to take it to a place that works on those type of recorders, then let them just take a look, and ask them "what they think"
Dont let them do anything on it, it wont cost then... And then see if you can find parts for this camera, and or even one on Ebay (which I see them sell cameras just for parts) and then try and fix it yourself.
But otherwise. I would look into buying a new one.
Sorry about your camera, that really stinks... But I would not give up yet, since you just did find your issue. I'll see if I can find anything else.. that was just a quick search on my part.
I'll let you know if I find anything within 24 hours.