It appears that the only workaround is owner-draw, or a third-party button control. Check out the Glass Button by Roy Klever.
This is a bug in Windows Aero DWM or else a bug in the windows common controls, or a bug in the way the VCL class hierachy handles common control window messages and painting when painting on glass. In short, windows common controls do not paint themselves properly on glass, or rather DWM composition (Aero) is broken. Surprise surprise.
The standard VCL button component uses the Window Class BUTTON from Windows Common Controls.
Note that TSpeedButton does not use the windows common control, and does not have this problem. however, it also does not accept focus.
It appears Embarcadero knows about this issue, it is QC # 75246. Buttons are not alone, this is part of a group of QC reports including panels, and other common controls.
However I have a commercial TcxButton (part of developer express components) which accepts keyboard focus, and does not draw this glitch. Any code that uses the Win32 common control button control appears to have this problem. It may be possible that a low level Win32 API hacker might find a workaround for this. I am looking into it. This answer will be updated if I figure it out.
One interesting detail: TcxButton has three drawing styles, cxButton.LookAndFeel.Kind = {lfOffice11,lfFlat,lfStandard}. Selecting lfOffice11 adds this glitch back in. It looks like a strange interaction between the glass feature in aero in Vista/Win7 and the common control/xptheme button drawing code.
It may be that the only workaround is to use a completely app-drawn button control and to not use Windows common controls buttons, or any button control that relies upon the XP theme engine to draw buttons, on an aero glass pane.
Edit: July 28, someone at Embarcadero has closed the above QC Entry, which was a mistake. I am urging them to reopen it, if only to clarify if this is indeed a Windows bug in the common controls dll.
If you wish to play around, make a copy of the VCL source code for the TButton and TCustomButton classes from StdCtrls, as I have done here, modify CNCtlColorBtn, so that you force one of three things to happen - PerformEraseBackground, DrawParentBackground or inherited, and see the results. Interesting stuff.
procedure TCustomGlassButton.CNCtlColorBtn(var Message: TWMCtlColorBtn);
begin
PerformEraseBackground(Self, Message.ChildDC);
Message.Result := GetStockObject(NULL_BRUSH);
(*
with ThemeServices do
if ThemesEnabled then
begin
if (Parent <> nil) and Parent.DoubleBuffered then
PerformEraseBackground(Self, Message.ChildDC)
else
DrawParentBackground(Handle, Message.ChildDC, nil, False);
{ Return an empty brush to prevent Windows from overpainting we just have created. }
Message.Result := GetStockObject(NULL_BRUSH);
end
else
inherited;
*)
end;
Some interesting reading on Vista era glass/DWM/aero APIs (C++ developers blog)