Sounds less like screen burn-in from the dock than pressure on the edge of the LCD panel--try pushing lightly on the surface of the screen somewhere else, and see if the pattern looks similar.
If that is the case, either you did something to your iBook (tweak the frame that holds the screen, for example, or jar it in a way that damaged the LCD) to mess up the LCD, or it's defective. You might try flexing the screen gently and see if the problem goes away, in which case it's misaligned somehow (might still need to be repaired, though).
Likely something you'll have to have serviced--hopefully under warranty, since screens are expensive.