This has been caused before by "flaky n**d*a" chip syndrome, actually the problem is the interconnects not the chip itself.
It can also happen due to a bad LCD controller, I've had this happen to two 22" Macs before and it always started with intermittent glitches and lines followed by total catastrophic failure.
A slightly more common cause is bad RAM, as most of these use off the shelf SODIMMs this is really easy to check if you have an old laptop kicking around with a suitable slot.
I have also noticed that in some cases a bad LCD can be fixed by replacing the open fuse, although the cause is still there ie bad chip it will usually work long enough for the replacement to show up.
Apple are usually fairly reasonable if you explain the problem :-)