I am having the same problem as in the original post. When I take long distance images the autofocus cannot hold a focus. When I manually try to focus, the distance becomes clearer, as it should, until I reach the infinity focus setting, where everything goes blurry. When taking long distance photos, it takes 20-50 tries before the image becomes focused with autofocus. This makes it nearly impossible to take pictures with the Lumia 1020.
I followed the instructions on Nokia's website and tried software updates and a factory reset. As nothing worked, and my phone is still under warranty, I sent it in for repair. After a week and a half my phone was returned to me and the fix Nokia listed was that the repair center did the factory reset and software update that I did before I sent it in. This did nothing for my camera and it remained broken.
I then called Nokia and told them what happened. They said to send my phone back in to the repair center and that this would tell the engineers that their solution did not fix my problem. I did this, and was without my phone for another week and a half. I got this phone back yesterday, and once again the repair center did the same factory reset/software update that I originally did. This was the same software update that they claimed was a fix the first time I sent my phone in. My phone has been sent to Nokia's repair center twice and my camera has yet to be looked at, let alone fixed.
Please help me figure out a way to fix this before my warranty ends. I no longer want this phone, and plan to avoid Nokia in the future. However, I would like to get this phone fixed so that I can at least sell it before I buy a phone from a different company.