iPhone Power Button Problem? + Warranty

Hi, a few months ago my iphone 3gs had the power button jammed down, not necessarily jammed and not working but, it does not spring back up.

usually the button should be sticking up a little bit making it easily accessible, the problem now is it's flush with the iphone itself, and the only way to press it is to use a finger nail.

my iphone 3gs should still have warranty since it came out in june 2009.

so my questions are...
1. will warranty fix the power button
2. will they fix it on the spot or will it have to be sent in and what iphone will i have til then?
4. what is the process when i bring it to the apple store such as what do they do, or will it be no questions asked?
5. should i restore my stuff before i go so they would not have to look at my personal info on the iphone and other precautions i should take?

thanks in advance.