I contacted DELL support yesterday and I just received an email from them that they were shipping me a replacement unit under the Complete Care Warranty. I've had many PDAs, my first one was a US Robotics Pilot 5000 and this is the first time I've ever had problems with one, so I'm actually really happy with DELL's customer service and quick resolution, hopefully they will have a replacement in stock and I will be back to normal within the next couple of days. Right now I'm back to using my old ZIRE 71.
Here are some images I sent them of the device:
LCD turned on

Back of Device (no scratch)

Top angled view of screen (no scratch)
My guess is that something in my bag must have shifted and applied some serious pressure to the back of the Axim, which was in it's case. The plastic used for the back of this thing is fairly flimsy and flexible and could really use a metal or harder polymer shell.
Anyways, thanks all for the advice, looks like I'm on my way to getting this solved.

to DELL Support (so far

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* EDITED - Smaller images