I'm not sure if you'd like to try this but... http://www.tbogard.com/2012/11/27/how-to-fix-the-red-screen-of-an-ipad-2/
It's about hitting it gently with a hamer. Gently!
And another way I've found is slapping it straight in the apple on the back. Here you have how: http://www.youtube.com/watch?v=KAfsoINmxi0
For that guy it worked and many people say it did for them as well.
hi. i have the same red screen problem (ipad2 16GB). it never fell down or so. it just appears one day. first time, i shut it down overnight, then it was fine again. but the red screen came back after a week, the shutdwon dindn't work out this time, but the "other way" did, the slapping methode! thanks.