On those models it can be any number of things. Those older MacBooks are a pain when you have issues like this. It could be the inverter, it could be the display, it could be the display cable. Everything except the display is pretty cheap. PITA to put in, but cheap.
From the sound of things, I'd put my money on a bad video cable. You can go to Apple's website and find where the nearest AASP is to you. You don't HAVE to take it to an actual Apple store. Other places may be able to offer a better rate anyway.
Worst case, Apple has a flat rate mail in repair program. So if you're sure the problem isn't the result of liquid damage or some kind of abuse on your part, you could get it fixed for ~$350US. That'll cover anything and everything wrong, and in my experience, the depot people tend to replace things like fans not so much because it's necessary, but because it's probably a good idea. They'll ship a box with a prepaid label right to you, you package your laptop and ship it off to them, and then they'll ship it back to you.
However, that is a good chunk of a new laptop, so you'll probably want to think about whether or not you want to use this as an excuse to buy a new laptop. You also have the option of attempting to buy the part off ebay or some such place, and doing it yourself, but when it comes to messing with the display assembly on non-unibody MacBooks... Unless you're a pretty seasoned hand at laptop repair, I wouldn't recommend it. Keeping track of all those screws alone is a PITA, but dealing with those little plastic clips that hold the display bezel on is a special hell unto itself. It's worth paying someone to do it, trust me.
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