Hmm, well if it's not too expensive, I say go for it. I've heard that you can send in your console to Sony, but it costs around $150 + shipping, compared to the cost of whatever tools you'd need to get to try fixing it yourself, which my dad already had most of. Also, I'm not sure how any warranties would tie in, seeing how I got my first PS3 used from Gamestop.
If you do get it working, copy all of your save files to a USB drive, or maybe an SD card. Depending on what games you have though, some of them might not be copyable.
There's also this method, but I haven't tried it, and I assume you would need both systems in working condition long enough to complete the transfer.
And yeah, mine was backwards-compatible as well, but I don't have most of my old PS1/PS2 games anymore, so it's no biggie for me. I guess you could always look for a cheap new or used PS2 though.
Lately, I've been playing LittleBigPlanet 2, Minecraft, and League of Legends with my friends. My old PS3 derped out on me - I managed to "fix" it for about 2 days, and then it started wigging out again, so I ended up having to buy a new one with my Xmas/B-day money. I was hoping I could save up to build a new PC with it though...
I'm really curious about how PSO2 is going to be. Word going around is that there's supposed to be an announcement in April about it. I just hope it doesn't suck, lol...
Hey, It's been quite a while. I haven't really seen you online. I still have kyo's card from way back. You might know me as Sakurazaki. We need to get together again sometime.