Right click on an empty part of the task bar and check to see that
'Expand' is checked. If not, check it and you should be back to normal
- although you will need to reposition any icons back to where you want
them.

That should have read "Right click on an empty part of the task bar,
select 'Properties' and check to see that 'Expand' is checked."

Right click on the task bar in an empty space and choose Properties. Make sure
there is a check mark in the box that says Expand. You can also make it bigger
by choosing a larger pixel size.

That box in properties is already checked. Larger pixel size just makes
it fatter, not longer.

I am not sure what you see on your screen. Did it expand at all when you put a
check in the expand box? Is the bar transparent or the default background? I am
just wondering if you can see clearly what is happening. If it is transparent
click on the Background tab and change it to None (use system default) until you
get it resolved.

Also try adding applets to the panel and see what happens when you do. Does the
panel expand or does it stay the same and if the latter do the added applets
show?

If this persists then I would consider adding a new panel first. It will appear
at the bottom. If you already have one at the bottom then you can skip this
step. Then I would delete the old one and move the bottom one to the top and
then I would add the applets that I used and see if that makes a difference.
Finally you can add a new panel which will appear at the bottom and add things
that you want down there. I tend to use only a top panel as I like as much
desktop to show as possible and like to keep all my applets centralized. It is
all about taking ownership and making the OS work the way you do.

If the new panel continues to misbehave then I would consider reinstalling Gnome
or start messing with the settings in your home folder and even deleting the
.gnome2 folder in its entirety. Keep it in the Trash just in case. If you have
another desktop such as KDE or XFCE installed you can use that until Gnome is
straightened out.