Sadly, your only option may be to replace it. You could contact B&N and inquire about a repair, but at over two years, you are outside your warranty period. Any repair would come out of your pocket, and likely be more than a replacement unit would cost.
How handy are you? I've seen web sites showing how to open the nook color. If opened, you may be able to remove a bit of dust or something and get the button to work again.
Try an online repair company like iFixIt.
They also have Nook tear-down step by steps. You should be able to fix it yourself or have them fix it.
Of course, as another user pointed out, it might be just less of a hassle to talk to B&N and see if they offer you a discount on a Color or a Nook HD.