the only problem i can see with this is if the genius does agree to your problems and then agrees to replace your phone, you are going to lose your friends sim card.
he could still just call the operator and ask for a replacement sim card, but it would take time and invariably there is a charge to get a replacement sim card..
someone please correct me if i'm wrong..
I doubt they would need your sim card, especially for hardware problem. If anything just tell them that you have a spare phone to use and that you need your sim card.
Also, don't they usually replace your phone on the spot with a refurbished unit? Has anyone ever taken in an iPhone because of hardware problems and actually have to have the phone sent out for repair?