I was also facing the same problem..!
Touch sensitivity was missing in mid region of touch screen..
I have also given my phone to service center..
Service center guys are fool i gave them my phone they dont even looked phone they said to me "we are going to update your software first
, all data will be lost"
They update it and got concluded that problem with touch panel..
They have taken my phone and said 8 days will be required..!
Now i'll get my phone on probably by 15/06/2012..
OK I have a question in my mind whether this is all happening due to flashing roms or flashing new version update through SP Flashtool..
One day i reboot my phone into engineering mode
-> item test -> Touch Panel ->
At that time i came to know that the lines are not made continuously

which was a failure Hance a Hardware problem..