As Scooba says (right as usual ) Microsoft apparently offer replacements for faulty hardware. Sadly I'm not too sure of the specifics, but if you get in touch with Microsoft themselves, they should be able to help you out with the details.
If you do want to go down the route of a new mouse, then as Embattle says, the wireless Logitech MX700 and slightly cheaper, but wired, Logitech MX 500 are both supposed to be brilliant. Otherwise, Microsoft's mice, your experiences aside, are usually extremely good too.
I think their warranty is much longer than a year, in any case they generally don't ask for proof of purchase (and in many cases don't even ask for the dead mouse back) - so call them, what have you got to lose?
MS replaced a 3 button optical MS mouse last year for me, it wasnt a year old, but they never asked for proof of purchase either (although they did require the serial numbers off the bottom of the mouse, I would be surprised if they used this as a reference to the purchase date)
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