My late 2006 15" Macbook Pro starting exhibiting the same problem a few days ago but then suddenly fixed itself. Not sure how but this is what happened.
I was watching a live streaming sports PPV on my Macbook Pro and had the video enlarged to full screen. Half way through the event my MBP fans started running louder and that's when the red line problem occurred. It was mainly in the blacks, dropshadows and dark colors of the screen. Tried rebooting, zapping pram, turned it off until the next morning and nothing seemed to work.
Read that it could be hardware issues and thought I might have broke something when a couple weeks ago I installed an SSD hard drive and replaced my dvd drive with the previous regular hard drive. But the thing is it was working perfectly until I started watching the PPV.
So a couple of days later I booted up again and the problem was still there and figured I'll open the machine up next weekend. In the mean time I started moving essential files from my standard HD to my SSD and saw a video I wanted to watch, so I installed the latest VLC on the new drive and after watching the video I noticed the red lines disappeared and my display is back to normal.
Not sure what fixed it or if the problem will come back, but I do remember when I was trying to stream the PPV I kept switching feeds and getting missing video plugin errors and the fans getting louder than normal. And the two things I did before I noticed it went back to normal was reinstalling Visual Hub and the latest VLC and watched a couple of .avi and .flv movies and now so far so good.