Grep through ~/.icewm/preferences for anything that looks good.
Maybe
TaskBarKeepBelow=1
or
TaskBarAutoHide=1
would do.
If you like it, put 'em in prefoverride just in case another file tries to set 'em different.
I don't use xine but I don't have any problems with full screen apps - must be a xine thing. (I don't use either of those settings above, either, but they should at least get the taskbar out of your way.)
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