I have read on some of the apple forums that the inverter board might be to blame, but it still has brightness control. I have ripped apart the lcd unit and found 4 cables that connect to the inner area. 1 - TMDS cable, 2 - the mic cable, 3 - the power light cable, 4 - both inverter power cables. I double checked all of those and still no change. So far it's boiling down to one thing, the logicboard.
Here are a couple of videos showing what the iMac does when it boots up.
I have also pulled out the logicboard, pulled out the battery, pressed the PMU button underneath, pressed the power switch, let it sit overnight, put the battery back in and put the logicboard back. yes, i have also redone the thermal paste so that is all done.