Is it worth trying to repair an ipod touch?

Your assumption is correct; Apple's warranty does not cover user-caused damage.

As to whether it's worth paying for replacement or repair, that's pretty much up to you. If the iPod is a first or second-generation unit, then for me it wouldn't be worth it and I'd put the money towards a 3rd or 4th-generation model. Apple often has good deals on refurbished units, so that might be worth looking into.

If the iPod is already a 3rd or 4th generation unit, then it might be worth paying for service, though I'd think hard about paying for service on a 3rd-generation unit since it won't run the upcoming iOS 6. A 4th-gen unit would definitely be worth servicing. Apple does not repair iPods, but will replace the entire iPod for a flat fee; see the Repair Pricing section here:

http://www.apple.com/support/ipod/service/faq/

There are independent iPod repair services that may be able to perform a repair. Do a web search for "ipod repair". Note, though, that if you elect to have the iPod serviced by an unauthorized shop, all further warranty will be void (if Apple replaces the iPod, you get the remainder of the original warranty, if the old iPod was still under warranty, or 90 days, whichever is longer).

Regards.

Don't forget the DIY (Do It Yourself) option. Parts can be had relatively inexpensively (and the vendors usually supply tools...) and there are numerous "How To" guides on the web, some are even multi-media.

Google, eBay, and You Tube are your friends.

FWIW, I have repaired a 30gig 5th gen iPod Video, an 8gig 2nd gen iPod Touch, and a 30gig Zune with parts from eBay....

DIY is IMHO a good option when the part to be replaced can be easily and definitely determined, but in a case like this where the problem could involve one or more of several different parts, I wouldn't think it a good option. Cumby could easily end up purchasing and replacing several components trying to get the iPod to work.

Regards.