I had a case on my Titan that was the cause of similar issues. The rubber around the bottom of my screen was creating all sorts of problems but mostly not registering my inputs. I just changed cases and all problems went away. Just a thought...
Sent from my Transformer Prime TF201 using Tapatalk 2
Yes, I did it and has no effect. These button issues are hardware problem as I suspected. They may or may not be worked around by a firmware (but tweaking the way how those button press are registered) change. Hard reset can only resolve issues in general OS level. This is purely firmware level problem.
The real solutioin here is to exchange the phone. I will do it tomorrow. Finding a store who has the phone (especially the Cyan one) in store is the chanllenge.