I don't know what I did, but my iPod's display is back to normal. You can still see 3 gray pixels but they're scattered. I notice it was gone a couple of days back after I charge my iPod overnight...hmm...
My Ipod has gray pixels on the left side of the display only when the backlight in switched on, and it seems to grow bigger. When the backlight switch off after 10 seconds, the gray pixels disappears. The display shows everything properly when the backlight is off. Is there a way to fix this or do I need to replace the display?
Also, it seems that my ipod has been showing signs of slowing down lately. It takes time for it to go from one menu to another. On the worst case scenario, it stopped responding to the clicker. I managed to fix it after using restore on itunes, but a couple of weeks after that, the signs of lagginess starts showing up again. I'm using a 80GB ipod classic.