Converting Acceleration of ADXL335 data into displacement
Converting an Analog Accelerometer data into the distance is fairly difficult because of the offset involved in double integration causes drift as already told. Check this interesting presentation sensor fusion for further details.
As far as I  know, this drift can be avoided by using Digital Accelerometers (with high sampling rates) and the double integration has to be performed using electronic integrators with appropriate filters at every stage to remove the offset as well as the low-frequency noise. Your ADC sampling rate looks very low! Use higher sampling rate and if you can design appropriate signal conditioning circuit at each stage, you might be successful with decent results!  

Hope this gives little more insight into your problem:)  

PS: I myself have investigated ADXL335 for using it for vibration measurement and have failed miserably. I had to standardize my values with optical vibration measurement.