Body sweat damages iPod

I purchased an iPod classic a little of one month ago. A few days ago a lock was displayed on the upper left of the iPod display. This prevents the user from controlling the iPod.

After resetting and reloading the iPod to no avail, I sent it into AppleCare Service. They sent it back declining warranty service. Their explanation was "A diagnostic evaluation has determined the iPod has internal damage related to a liquid spill or contamination." I have been told there is a strip inside the iPod that changes color when it comes in contact with a liquid, similar to those found on cellphone batteries.

The only liquid the iPod has came in contact with is my body sweat. I am extremely disappointed that the new iPods are not as durable as the older models. It seems that the iPod should withstand contact with the human body in a hot environment (July in Southern California). I have an older 20GB iPod, have used it in the same way as the newer one, and it is still working fine. The only degradation in performance with the older one is that the battery doesn't hold a charge for as long as it use to. Are any models of iPods (or other MP3 players) model resistant to failure due to contact with body sweat?