Quite honestly, Nuwisha, there isn't much we can do to help you out. The fact she was selling it without a receipt outside of the Gamestop should have raised a red flag in your mind that either there was something wrong with it or it may have been stolen. They may have checked it out in the Gamestop and refused to buy it because it wasn't functioning properly in some way. Even if you did have the receipt your modding would have voided that warranty.
Also, we are not supportive of the modding/ homebrew scene here- Sony designed the thing to be used as is plus certain mods/ apps allow the use of pirated games, which we are very much against. Finally, NEVER leave something like this sitting in the open at a party- that's just asking for someone to steal it/ do something to it. It's possible someone's drink may have spilled nearby and some got inside the PSP.