Without seeing your device, I couldn't tell. You can see a teardown of the device at the link below:
May I reccomend going to a nearby Apple store, where they may offer you a replacement or repair.
Sorry about this,
Accidental damage isn't covered by the warranty. The apple store will likely offer you a replacement for a reduced fee, 249 and up depending on hte model. What you're paying for is a reduced price for a refurbished one.
You can take it to an authorized repair place and see if they offer anything different.(They'll probably go with the replacement for a fee option) or if you want to void your warranty you can take it to an unauthorized place, but that's caveat emptor....buyer beware. You get what you get and any remainder of your warranty is void.
Apple's Limited Warranty http://www.apple.com/legal/warranty/ for iPad excludes coverage for damage resulting from accident, disassembly, unauthorized service and unauthorized modifications.
Apple will provide a replacement iPad for:
iPad model Out-of-Warranty Service Fee New iPad $299 iPad 2, iPad $249
You can get the glass replaced at 3rd party repair sources for less $, however, the Apple warranty will be voided.
iPad Repair & Screen Replacement Services
RepairZoom iPad Repair
That might actually be covered under the Apple warranty! Have you tried going into an Apple store and just showing them the iPad? If the screen is unbroken it may be covered under the normal Apple Care warranty. I always recommend that people try Apple first. Sometimes Apple comes through and has compassion and sometimes if there is no physical signs of damage they will warranty the damage. Especially if that damage is internal!
If you don't have any luck with Apple you can try out our ship-in repairs for the iPad. We've done over 1500 iPad repairs to date and as a repair technician I know the issue you are having is probably just a loose LCD cable. I sincerely doubt that the LCD itself is damaged.
Good luck with your iPad 2!
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