>> Yes, even absolutely tiny amounts will make the LC useless.
>
> Really? I thought it might just make the edges go a bit fuzzy or 
> something...

Something to do with how the moisture gets absorbed by the LC, of course it 
starts from the edges wherever there is the "leak", but it quickly spreads 
across the whole panel until you don't get any picture.  I suspect the water 
molecules are severely impacting on the electrical/optical properties of the 
LC, and given that you're talking about a thickness of a couple of microns 
you don't need many water molecules to mess things up!

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