Legal advice regarding Warranty ripoff?

Please read my story and tell me if you have any advice about what I should do about suing this car dealer.

I bought a VW Passat from a dealer and was offered a warranty, I paid $1000 for this warranty and was given a service contract, two months later, I had some problems with the car(the rear window motor stopped working and the CV joints wore out) and called the warranty company about fixing the problem, I was told that I had no warranty at all, despite the contract I had from the dealer saying I had a warranty, I called the dealer and was given some shady story about the dealer forgetting to send in the money for the warranty. Three days later, after repeat calls to the dealer, he somehow managed to get the Warranty company to pay to fix the car's problem and I was given a different contract number.

Soon after this, I had another and more serious problem with the car, the O2 sensor and Mass Air flow sensor went bad, the car started spewing a lot of thick black gas when I drove it and was burning gas at a rate of 9 miles per gallon bcuz it was running very rich. I called the Warranty company and was told that the dealer still had not sent in the money for my warranty and they had fixed the previous problem bcuz the dealer had promised to send the money in, but this time they would not fix it unless they got their money. I went thru three more weeks of driving the car like this before the warranty company agreed to fix it based on another promise from the dealer. During this three weeks I still had to drive the car, it was miserable bcuz you could smell the thick exhaust smoke inside the car, I had a pregnant wife and my baby son in the car also. At the VW dealership I was advised not to drive the car bcuz of the toxic smoke, I was told driving the car was the same thing as locking yourself in a garage with the car running. During this period I also went to talk to a lawyer who advised me that he could write a letter to the dealer but he didn't think the case was worth taking to court. Later on the car was totalled in an accident, on the warranty contract it was stated that if for any reason the warranty was cancelled before it expired you would get some of your money back but when I called the warranty company, I was told they never got any of the money, the dealer had simply given me a contract that was worthless and stuck my money in his pocket.

I have decided to take the dealer to small claims court even though I've been told this is a waste of time I will not get anything out of it, I don't want the dealer to be able to do this to someone else again and from speaking to the lawyer I was told this is something that happens a lot, I also can never forget or forgive the dealer for what I had to go thru which is my family breathing in that thick smoke while he kept my money for his own personal use. It's fraud and I'm not gonna let him get away with it.