Google terms of service says that you cannot hide the fact that it is an advertisement. This includes covering up any part of the ad block. The ad block must be fully viewable, as it is.
Why do you want to hide the "ads by Google"? Too risky to do that mate It's clearly stated in their TOS.
Do that and your account will be toasted. No gaming the Google since they are smart enough to game you. It's like don't play with the adult if you are a 5 years old. You never understand how smart are they. So stay on radar, just increase your traffic and place in a good hot spot to increase your earning. Steady but sure.
It's already been mentioned that they didnt change the code at all; you're preaching the wrong rules All that's been done here is the ad block has been slightly covered over... Which of course is still against the ToS! Chuckun
You would be better served by making the background of the ad the same color of your site as I have done and the ctr will be very good than to fool with the adsense script. It's within the boundries of adsense and it works great!
People who know about advertisement won't click even if you hide it... And people who don't know about it will click even if you show their text in default size.. Better not to use this technique.
place the ads in the original size and with the original code, otherwise you can get banned very soon. don't cheat google, they know all what we / you do.
just out of interest, why would you want to do this? Do you think it will improve your click thru rate?