I think it is worth fixing.
Contact pentaxrepairs@aol.com for a complete CLA, he'll charge you around $75 and your camera will be back in top shape.

Also, this is an olnine repair manual for your camera in Kim Coxon's website:
http://www.pentax-manuals.com/manual...icemanuals.htm
choose the S3 manual, it applies to your camera as well.