Water can damage your iPhone 3G, as you say there is no corrosion to happen here is a fix.
Press a small insulated wire between these points.
I would like to manage this situation with an ounce of dignity. I would not lie, and I wanted to see what was needed for repair. I would not walk around with a deep sense of right to lie and steal from a company because of my negligence. Whatever your ability or inablity to explain how or why things have tried to take it and tell them you can not get it to work is wrong.
I am not, however, the moral police. He lives with his own decisions and I'm sure, no matter what we say here will not change its moral compass direction. I can not wait to see the following conversation about how you screwed up either Apple or how I hate their customer service, according to the results.
Take better care of your kid stuff.