The lens on my Sanyo VPC E760 camera moves erratcially

The lens extends and retracts erratcially, as if grit is jamming it. Often it doesn't come out far enough to take pictures. I blew compressed air on it and that helped a little but not enough. The warranty is expired, but I would consider having it repaired by Sanyo or someone else if the costs weren't more than what it's worth (I paid about $125 for it at Walmart three years ago.) Should I try some graphite? Help!