While a thermistor might fail, they're pretty robust SS devices...it might be the control board. Often, there's an easy test for a thermistor if you have a multimeter...the resistance at a specific temperature can easily be read. A pot with some water in it and maybe some ice, and you can check that it changes over temperature changes according to the spec sheet (which might be in the manual).
As said earlier, some tankless systems/models void the warranty if you add recirculation, or don't do it per the instructions. Regardless, it does stress the thing more than without, at least in a typical home. Another reason why a commercial installation and residential tend to have different length warranties.