I sent my ps3 off to be fixed by that company listed on ebay. Shipping took a while(ups ground, from Alabama to Michigan and back), but I received my unit one week after shipping it.
I was pleased with the work - I didn't include my hard drive when I sent it, and that wasn't a problem for them. Also, the unit had my copy of Warhawk and would not eject it. When I received the unit back, it worked just fine, and I even had my copy of Warhawk back.
The unit worked for 4 days, then I had controller issues, and finally the unit stopped working completely. I no longer had the YLOD - when the unit powered up, it would stay on, and would respond to the eject button and the power button. But that was it - I never got any audio or video, either over HDMI or the a/v cables. Also, I could never heard the hard drive spin up.
I called the company, and they said they would look at it again. We shipped it off, and they called last night. My wife spoke to them, and they explained that they could not repair the unit. She didn't get the full technical explanation - regardless - it was something they were not equipped to handle. Fortunately, they said they would refund the full amount. The only thing it cost me was shipping, and time. But I'm cool with that.
Now I'm going to pursue the Sony option. The thing that pisses me off is the fact that I never backed up the machine. I'm cool with losing my save games(though that is irritating) - but I also had some photos on that box that are no where else(no other memory card readers in my house). To top it off, I was working the entire time I had the "fixed" unit back, so I never had an opportunity to back it up. So those photos are lost - and now my wife is pissed at me
In the mean time, I went out and picked up the Uncharted 160gb bundle, so my son is happy that he can play LBP, Lego Batman, and Lego Starwars once again.