Thoughts on frustrating situation.

I'm only going to disagree with this, to say that if the OP did do this, and did actually have a warranty, it's going to shoot that warranty in the foot and give them legal rights to deny everything.

Pursue the warranty you're supposed to have, and then jump like Gunbunny says if that fails. Paying to repair is cheaper than a judgment in small claims court, typically.
I'm not suggesting sue the warranty co, I'm saying sue the dealership. I've seen time and time again salesmen misrepresenting aftermarket warranties.