Rob, you are partly correct, but my understanding of Error 99 is that it just means that something is wrong; not necessarily lens. Best case scenario: your contacts are just dirty. Try doing this, at your own risk:
Richard's Notes » Blog Archive » Canon DSLR Error 99 fix
You can try wiping with a microfiber cloth and some rubbing alcohol as well. Also, try cleaning the contacts on the lens, and try using a different lens to verify that the problem is your body and not the lens. Try using a different memory card as well, and make sure to format the card in the camera to see if the problem goes away. Depending on what camera store you went to, I wouldn't necessarily count their verdict as being of much value. By far, my favorite camera repair shop in Houston is Professional Camera Repair on 4410 Richmond, just east of the Galleria. Try checking them out, and they may be able to figure out the issue better.
If none of this works, then it could be time to upgrade. You have nothing to lose by sending the camera in to Canon, but this error could be caused by a number of things: moisture causing a short on the circuit board that interfaces with the card, dirt on the contacts to the lens, etc. Canon's techs will take a cursory look at your camera and determine the cost to fix it, based on a tiered repair system. It could be worth more than the value of your camera. If so, then you can do a loyalty trade-up program. The current prices are:
Rebel XS - (only with 18-55mm lens) $320 (updated 6/4/2011)
Rebel XSI - (with or without 18-55mm lens) $400/$335 (updated 6/4/2011)
T1I - (with or without 18-55mm lens), $480/$416 (with 18-55mm Lens) (updated 6/4/2011)
T2I - (with or without 18-55mm lens), $512/$448 (with 18-55mm Lens) (updated 6/4/2011)
50D - (with or without 28-135 lens), $665/$563 (with Lens) (updated 6/4/2011)
7D - (only without lens), $1087 (updated 6/4/2011)
Taken from this thread:
Canon Loyalty Program - return old camera, get better camera
For excellent shape cameras, the Canon 40D is currently $600 at KEH, and the 50D is $820-$850. You can read the comments in the "40D for IR Photos?" thread to see a quick discussion of which camera people like, but from my experience shooting Canon, from the old Rebel XT all the way to the 40D, I think you'll be very happy with the improvements of a 30D, 40D, or 50D over what you're currently shooting. However, I still hope that Professional Camera Repair or Canon can fix your current camera cheaply enough that all of this will be moot.