I need some help installing my motherboard to my case. The instruction manual that it came with for installing the motherboard is nothing more than a crappy diagram that it illegible and there was nothing in my motherboard instruction manual.

I know that I can't let the underside of the motherboard touch the case, but the problem is that my case didn't come with any washers or raised screws of any sort, although it did come with insulators. The case has a removable motherboard tray, and the screw points are already raised up in a buble shape so the motherboard lays half an inch over the tray when placed on these. I really don't know what to do from here. All the guides online use a case that needs washers to hold the motherboard away from it, and I don't want to fry my mobo. What should I do?

As you suspect, your motherboard needs to stand off from the case or else it will short and everything will explode in a shower of wasted money

If you have a case with pre-formed standoffs, like an iCute case, that's fine. You can tell that the motherboard is in the right position, because the rear jacks will fit into the ATX back panel nicely, and the motherboard will run parallel with the case. Usually, there aren't enough pre-formed standoffs (unless you have a micro ATX case), and you'll need a few of those hexagonal brass standoffs, that should be supplied with your motherboard.

There are commonly two gage of screws inside a case; wide threads for Hard Disk Drives, panels etc, and narrow threads for optical drives, diskette drives. Make sure you use the correct gage for the motherboard; stripped metal can get where it shouldn't.