Posted this in another thread on the home button issue:
I've been having this problem for the last couple of weeks and I think its a software problem. Couple of observations.
1. I can always restore home button responsiveness by plugging in the charge cable, letting the phone sync, and unplugging it.
I figured out this morning that I can CAUSE the unresponsive home button by:
1. plugging in the charge/sync and letting it go through a whole sync cycle.
2. while the cable is plugged in, I turn the phone, unlock, and press the home button
3. unplug the cable cable
4. and now the home button is unresponsive
So, for me at least, I think that the unresponsive home button is related to charging/syncing. So, for now, I'll just make sure not to press the home button while the phone is plugged in.
If it gets worse or if iOS 4.2 doesn't fix it, I'll take it in...