Hello!

Can someone tell me where to change the padding in the area between the top widget area (under header image) and the center column/sidebars?

Site is here
WP 3.0
ATA 3.5.1

I've also attached an image that shows where I am talking about.

Thank you so much!

That's in the css inserts - look for this bit of code:
td#header {
padding-bottom: 20px;
}

Set the bottom padding to something smaller. Yours might not say 20px - I copied this from an existing site, where I'd actually set it to zero - I made up 20 for this post!