It’s explained how to do this here:
http://clockworkcoder.blogspot.com/2011/02/how-to-removing-facebook-application-i.html
Basically you should use
window.fbAsyncInit = function() {
FB.Canvas.setAutoGrow();
};
plus make sure that your html and body tags are set to overflow:hidden so you don’t get those briefly shown scroll bars that are so annoying
<html xmlns="http://www.w3.org/1999/xhtml" style="overflow: hidden">
<head>
<!-- Header stuff -->
</head>
<body style="overflow: hidden">