ATMEGA 1284p and I2C LCD Woes

Since you have a "Green" LCD, you don't really need the backlight. Or perhaps you can just reduce the current by changing the series SMD resistor on the LCD. Or change the LED jumper on the adapter to a series resistor.

Some modules have "sensible" series resistors for their backlight LED(s). Others just have a 0R which means that they take an unlimited massive current at 5V.

David.