Vertical Lines, not PRAM, bad LB or GC?

So I just got this 2.16 white MB. Originally when you started it up, there were the colored vertical lines on the screen and it didn't recognize a HD. I assumed that all I needed was a new HD, fresh install of Leopard, and to reset the PRAM. The install of a new HD went well but I can't get the lines to go away! I reset the PRAM and changed the display settings. I did a hardware test and it came out clean. Here is a shot of the lines



As you can see, this isn't the typical vertical line at start up problem. Is this a faulty graphics card, logic board beginning to fail, or something simple like a cable that may be going out or not connected properly? I've never seen this so please help!!

Update:
And its good news!
I bought the mini-dvi to vga adapter today and the display is flawless on the external!
So now here's the question...
Since we know its not the graphics card going out,
What part of the display is broken? If it were the back light I wouldn't see anything right? What exactly does an inverter do? And, what other cables are part of the display?
Thanks!