Oh, dear ! That is from the humidity being too high the last 3 days of your incubation period ! The chicks fail to absob their yolk sacs.
This is what was recommended to me, and has worked very well for me:
Keep the humidity around 50% for the first 18 days, and 70% the last 3 days.
If you aren't sure, get a Temp. / Humidity thing (actually called a Hygrometer) from Wal-Mart. I use the DIGITAL black square ones, about the size of a pack of smokes. Sells for $8.95, at Wal-Mart. They are in the lighting / light bulb / thermometer area of the stores.
I got ONE chick to survive when that happened, but it wasn't as severe as yours. Unfortunately, the ones that are as severe as yours usually do not survive.
I am so sorry !! I had 5 of them born like that in a single hatch, and lost every one, BEFORE I got one of those Hygrometer things I just told you about. WELL WORTH THE LITTLE MONEY THEY COST ! I have had NO problems with the "protruding belly-buttons," since ! Just put it somewhere in your incubator as level w/ your eggs as you can...I put mine on top of my eggs which are in turner racks. When I take the eggs out of the turners, I just set it in there (with the pipping eggs) to continue monitoring the humidity. Don't worry so much about the TEMPERATURE it tells you; that can vary a lot within diff. spots in the incubator. If you are getting a decent hatch rate, then your temp. is fine. But start watching the HUMIDITY very closly thru-out your entire incubation as well as the actual pipping and hatching.
Best of luck, God bless you and your little peepers, and I hope this will help !