By definition, the software only allows certain brightness levels so only by modifying that software (jailbreak or perhaps Apple changes things) can you go dimmer.
There are many apps that use the colors and draw dimmer text (Instapaper uses black background at night and many stargazing apps only draw in red). You could try using the accessability features to invert the white / black system wide. Even though the screen is still as bright, the largely black screen will block most of the light from escaping. You can even set the triple press of the home button to toggle this rapidly.
Lastly, there are 3M polarized privacy screens (watch for vertical or horizontal privacy - most only work in one direction) to help solve the light escaping to your side issue.
If she is seeing the light reflect off of you, you're going to have to look for other options. Psychologically, most people can fall asleep with light, but light and motion or light and noise are much harder to sleep with. Hopefully it's just the light as you might just need to drop the phone or move to another location if it's not really the light that's the source of the irritation.