There could be a possibility that part of the button located on the flex cable got damaged. Whereas you said it responds if you push the button on flex cable, I would verify the small black post located dead center is still intact. If not, a new flex cable assembly may be required shortly as that helps guide and maintain its function for shorting type of circuit that it is. If it is intact and not damaged the bracket that it is adhered to may have gotten bent down during the drop causing to large of a gap for the home key to make contact. With out risking damaging anything, sometimes the easiest fix is 1 or 2 small cut squares (no bigger than the button on the cable)of something like electrical tape on the button itself or in the center of the homekey. Best of luck and let me know how it works out if you haven't already done something about it.
sunruh sounds like a iPod touch 5th gen, or is it a Classic?
por oldturkey03
@oldturkey03 It is a touch, I should have said that.
por sunruh