Verify that the issue is indeed with the Touch Screen rather than with the device freezing by attempting to use the Hardware Keys. If there is a response, continue troubleshooting as a Touch Screen issue. Is there a Screen Protector installed on the LCD? If so, remove it and test the response from the Touch Screen. Screen protectors can interfere with the sensitivity and accuracy of the Touch Screen.
Attempt to re-align the screen by going to Start>Settings>System Tab>Screen and then tap on Align Screen or press and hold the Center Navigation key and then press the Internet Explorer Button. Note: To ensure accuracy, Screen Alignment must be completed using the device Stylus and no other object.
Does the issue coincide with a recent program addition (including skins, dialers, etc)?
If the issue began around the same time that you installed a 3rd party application(s) on the unit, remove the program(s) by going to Start>Settings>System Tab>Remove Programs:
After all 3rd party applications have been removed, Soft Reset the device by inserting the tip of the stylus into the reset hole on the bottom of the device. Once the Soft Reset is complete, retest the unit.
If the issue is no longer present, add the 3rd party applications back one at a time, testing thoroughly after each add. If the issue returns after the installation of a 3rd party application, do not use that application and contact the provider to see what other options are available.
If the preceding troubleshooting steps do not resolve the issue, perform a Hard Reset on the device. The preferred method for a Hard Reset is via Start>Settings>System>Clear Storage however, if the device is frozen or the Touch Screen is unresponsive, the Hard Reset will need to be performed by pressing and holding the left and right soft keys while performing a Soft Reset. Warning: All data will be permanently deleted from the device during the Hard Reset process!!!