Is the power button stuck because of a drop and damage to the metal casing? Or did the power button just malfunction on its own with no damage that you caused?
If you are under warranty and there is no damage inflicted by user, then Apple store should just give you a new/refurb ipod. You will have to restore all your apps and music so I would back up your touch before you take it into the apple store.
If the case is damaged then Apple won't cover it. They will charge you depending on the size of the iPod touch, 8gb, 32gb, or 64gb. If the case is damaged I would send it to iresq as I have sent multiple apple products to them and they can not be beat on price and customer service. Much cheaper than apple every time I have delt with them. They only do work for USA customers (not sure where you are locate).
I hope this helps, good luck.