Replacing Iphone 3G

Recently, my Iphones camera has stopped working. When you start the camera up it has the 6 slices and then it opens up to the screen where you see the stuff you want to take a picture of. Mine stays on the 6 slices. I called Apple and did the reset that is supposed to fix 99% of all problems but it didnt work. The guy on the phone told me to take it into the store. I have put off this trip because I have not needed my camera. Now, I have recently dropped and cracked the screen after only having it for a little over a year :. What i was wondering, is if there was any hope of getting my Iphone replaced because of the camera being broken, is it all lost because of the crack? Will apple try to blame the drop that caused the crack also on why the camera doesnt work?
Pc Windows XP