I wanted to add it's not the government's fault. Government regulations on fuel compositions are based on consultations with automotive engineers - probably hundreds of hours. They determine the max percentage of ethanol that can be used in a gasoline fueled vehicle without it causing non-typical wear to the engine's mechanical or electrical components, or the emissions systems.
The cause of your problems are due to one of the reasons mentioned above:
1. You're not bothering to tell us you deliberately put e-85 in a non-flex vehicle. If so, That would be your fault. I won't feel sorry for you.
2. The dealer is trying to scam you into paying for a warranty covered repair - in addition to what Curtis said, another common ploy is to get you to pay for it, then bill the manufacturer for warranty service (double-dipping)
Lastly and not yet mentioned, the fudge-factor in the gas to ethanol ratios seems to be getting a bit bigger these days. Oil companies do not sell gasoline when people stay home and don't drive, like what happens when prices hit $4.00 per gallon. To keep prices down and profits up, it's certainly possible a lot of "whoops! looks like we might have accidentally blended that batch at 88/12!!! Oh well!" Is going on.
But the government's fault? c'mon!
Is that President Obama hiding behind you car with a 5 gallon can of e-85?
OMG!