That really bites. If they wont pay for the warranty work, I would suggest telling them you would like a refund for the warranty.
Whats the point of a warranty if you can't use it.
I would also suggest you get the dealer to see if they can write you a letter stating the problem was not there at the time of the warranty purchase.
If all else fails, read the warranty thoroughly to see if there is anything in there that may help you.
'92 300CE - Sold
2004 C240 - C7 Wheels
2015 ML350 - P1, Pano, Ash poplar wood, Sport Dinamica interior, Running Boards Keyless go.