These are interesting symptoms, especially given the degree of leaf bleaching and the fairly straight-line pattern of damage. We aren't quite sure what caused them, though we suspect they are abiotic. (Abiotic plant issues are those not caused by pests or disease, but by environmental factors instead.) Was any substance (like a pesticide) applied to this area of lawn, or was runoff from something being rinsed or emptied collecting here (soap from a car washing, pool water, etc.)? Did an engine or any other type of hot exhaust blow on this patch of grass for a length of time?

Unfortunately milky spore isn't a reliable method of suppressing Japanese beetle grubs, though it probably won't hurt to continue treatments as the package label directs since you've already started. Even so, this particular damage was not caused by grubs.

For now, just keep an eye on the area and feel free to send additional images if the damage worsens or spreads to new areas. Over the next few lawn mowings, this damage should gradually diminish as the injured portions of the grass blades are cut off and the healthier portion below them grows out of it. (So far, the lower portions of the blades look normal and viable.)

Miri