AmbiLED from source
I'm using AmbiLED HD as a custom ambient light for my TV. After replacing the included LED strip with a larger one, I encountered problems with occasional flickering of the LEDs. A video clip can be found on YouTube.
The original kickstarter campaign has some information about the hardware setup.

However, on the hosts side I'm running the hyperion server which provides native AmbiLED support. With the hyperion-remote command the LED strip can be controlled. Amongst other features a Kodi (formerly xbmc) and Android client are available.
In order to start development I'm assuming you have the Arduino IDE installed and set the device to Arduino Nano with ATmega328 micro controller. The strip itself uses WS2812B digital LEDs which can be controlled individually.

You can download the source code repository from Google Code. Inside ambiled-hd/trunk/AmbiLED_Firmware you find the firmware (*.ino).
When compiling the project you have to include the Adafruit NeoPixel library which you find directly inside the Arduino IDE. Remove the line with the unresolved include (#include <functions.h>) and you're good to go. Take a look at the header file def.h to set pixel doubling for long strips and more.
In order to debug the flickering problem I wrote a very simple firmware to statically display a red light without accepting any input through the serial console. At this point I didn't witness any flickering, which means that everything is fine electronically. Displaying a red light on the whole strip through hyperion-remote -c red still shows the flickering.
At this point I needed to understand the AmbiLED firmware. Hence, I moved on to writing a minmal AmbiLED compatible firmware. The AmbiLED protocol sends each pixels color channel individually (R, G, or B) followed by a control command. Since the flickering is still present in the minimal version but not in the static one, I'm assuming there's a bug in the hyperion code for AmbiLED. Hyperion is currently being rewritten as Hyperion.NG without AmbiLED support at the moment.
However, inside the original firmware folder of AmbiLED there's also code for an Adalight compatible mode. After compiling and flashing this firmware the flickering is gone but all transitions seem less smooth.