Similar problem--started vacation 2 weeks ago, and first day out TC2 spacebar not working. Able to get by with BT keyboard temporarily. When I brought the TC2 back to the MS store, they exchanged it without blinking an eye.
They were so happy I had the original receipt. Apparently many people want to return something and don't have the receipt making it a hassle for the staff.
My only disappointment was that they couldn't tell me when the SP4 was going to arrive...