I bought a few USB enclosed-tube 10-led lights off Deal Extreme and used a dremmel to trim them to length to replace some burnt out tubes on a PSOne LCD. I think it actually looks better with white LEDs, but getting them in there is a challenge. Usually the modders just put a few big ones in and, yeah, there's some diffusion problems with that method (the light's a bit uneven, tho not terribly bad) With the mini-led strings I was planning to use the lighting was pretty even, except small bits of the edges. Not really a bad tradeoff for having the lights last forever and be so much brighter/whiter.
http://www.daftmike.com/2010/03/my-pson ... d-mod.html
more here:
http://www.dealextreme.com/p/flexible-1 ... lver-33090
http://www.overclock.net/t/170245/offic ... mod-thread
http://www.overclock.net/t/170245/offic ... ost_189472
http://www.extremetech.com/electronics/ ... one-screen
I got to the point where I'd need to do a bit more trimming, and apply a bunch of well-placed blobs of hot-glue to keep everything positioned correctly while struggling to close it all back up when I received a NIB PSone screen I had aparently bought at the same time in the mail. So the parts sit there unfinished right now (I believe I threw the transformer away, so if you needed that part, it's probably gone)...
I can't remember which brand has the smaller LED bulbs - the DX ones linked or the Nexxtech ones I got from Source by Circuit City, but both fit (the smaller one are just much easier).
Also, the power supply does handle all the LEDs at once, but they have to be hooked up in parallel. Too few or too many without resistors will pop and melt the LEDs (at least using the contacts I was using).
I can't say I've succesfully done the mod, but by holding it together with scotch tape I can say it looked pretty decent, and I believe for about $13 in LED string/tube lights it can be made comparable or better than an original unit.