Myra, along with her comment, gave me a link to HGTV's crushed velvet tips, which included a tip on how to make your own crushed velvet.
Following the simple directions, I steamed the fabric for 30 minutes while I prepared dinner. When the timer when off, I removed it, tossed it in the dryer and crossed my fingers.
Voila! Crushed velvet stretch dress with nary a trace of ugly horizontal stripes. I'm going to do the entire process one more time and see if I can get a smaller, more random pattern for the backside.
So much easier than stamping or bleaching the fabric and definately quicker and cheaper than resewing the entire dress.
So there you have it. A near throw away saved by the generosity of fellow creative souls sharing thoughts, tips, encouragement and expertise.