That's just the bottom part of the swf.
To get the look you want make sure to set showStatusBar="false" Then you have the full height of the panel to play with (minus maybe a pixel or two). You want to keep your elements a little in from the right so they are not obscured by the gripper. It's rectangular...
Perfect. Thanks for the assist. This is my first extension, so I've got a lot to figure out!