TV manufacturer won't replace defective TV set

I purchased a Proscan 27" TV in January 1998. It was bought at a store closing sale and all sales were final. The original manufacture's warranty came with the TV. Shortly after the purchase, the TV began to make a high pitch squelling sound at various times. I have had the TV repaired twice in the past two years for the problem, but the problem is still there. I contacted the manufacturer of the TV. I was told I had to write a letter to their consumer review board. I did that explaining to them the problems I've had with the TV. I told them that I wanted a replacement TV because I was sick and tired of having the TV repaired and was afraid that I had bought a "lemon" TV. Their consumer review board responded back that they were concerned with my dilemna. They offered to replace my TV as long as I send my current TV back to them and pay them $341 to cover the cost of the difference of age between the two TV's. I called them back explaining I was not satisfied with their decision. I was told that that was all they could offer me.
I told them that I wasn't giving them any more money for their defective product, and would take them to court if necessary. I paid $430 for the original TV. The TV that they are offering me retails for approximately $850. I live in New York. The manufacture of the TV (Thomson Consumer Electronics) is based in Indiana. Is this case winnable in small claims court or should I retain a lawyer?