The Allen Heath dropping channels is not an uncommon problem with them. Generally it tracks back to the Gain pot and not to the mute switch. More often than not, the gain knob can be cleaned and brought back to life, but you may have to actually replace the pot. The power supply problem sounds like a short in the wires which I have also seen. This is usally on the power plug on the console itself. Once again this is an easy fix if you are handy with a soldering iron and feel comfortable opening up the console. Sometimes it is actually a short, sometimes it is a bad connection (like a cold solder) going to the PCB board.
The PFL problem you are having should be the easiest to fix. I have not been in front of a GS3 for a while, so I do not remember exactly where it is, but I think the button you need to fix this is on the right side of the master section about half way up the master strip. You need to find the PFL area of the master section. It sounds to me like you have your solo in place activated. Generally when you solo a channel it will cue the soloed channel (or channels) in the control room and headphone outputs, but not in the master section. There are a few different solo types. PFL is pre fader. AFL is after fader. PFL will cue the channel typically with EQ, and whatever level the gain pot is sending (as if the fader were at unity). This is handy when setting gain trim and listening to channel EQ and insert settings. AFL cues things the same way, but the output is related to you in relation to the pan pot and the fader level. This is handy during the mixdown phase to hear how a certain channel fits in the mix. Solo in place is a more destructive soloing mechanism. Solo in place usually tracks to the main left and right outputs as well and is designed to mute all other channels except the soloed channels. This is handy when you have an announce mic and want to quickly mute everything but the anounce mic, or if you have a primary channel that needs to be activated at the same time everything else is deactivated. In the solo section of your master section there should be one button that switches the solo from AFL to PFL. The GS3 may not have this button. Sometimes inexpensive consoles have group and aux sends permanently set to AFL and channels permanently in PFL mode. Somewhere in that same section though there should be a button or even a recessed switch for "solo in place". My bet is that this switch is currently engaged. Nicer consoles will often have a button combination to activate solo in place or even a plastic cover so the switch can not be accidentally depressed. Solo in place can be disastrous if engaged accidentally in the middle of a live show
Hopefully this helps. Like I said I have not been in front of a GS3 for a little while but this should help. Sorry for the long description, but it sounded to me like you were not aware of how the whole Cue system typically works in a console.
As for the original poster... You are kind of stuck in a price range where you really are not going to have many options in the new console range where quality will improve much. As far as I know, Allen Hetah does not make the GS series any more, so if you wnat a new Allen Heath you will probably be limited to a 24 and maybe a 32 channel 4 buss GL. I would also reccomend you give consideration to the Mackie Onyx line if it falls within your price range. The newer Onyx seems to have made improvements over the older VLZ lines that are pretty vast. The preamps seem nicer, the EQ is much more responsive, crosstalk issues and headroom issues have both been adressed as well. With the current line-ups I would say that the two consoles are about equal in terms of sonic integrity and features.
