I've never heard of a stripe bulging out... The only part of wood on the neck that is exposed it the fingerboard. Is the neck warped at all? Gathering that the hardware is pitted and the wood is swelling... I'd be worried that it was left in a damp place causing all those symptoms. It wouldn't hurt to get some gauges on that neck to see if it's the only problem. If all seems well, if the feeling of that stripe doesn't bother you, then leave it be. But if it's going to annoy you... Even knowing that it's like that. Then you may need to sand it out.