I think your assesment is right in that it sounds like the panel itself still works. However, it sounds like there may be an issue with the logic board that controls the panel itself. The good news is that it should be relatively cheap to get fixed (the LCD panel itself is usually by far the most expensive component), but I'm not sure that Dell will do repairs (even if it was under warranty, they'd just send you a refurb). So it may be advisable to find a place that specializes in LCD repairs.