Look here (http://www.makeofficebetter.com/comments.htm) for a link to an example of my problem.
If you look at that link you'll see that I have a IMG floated left, and a DIV overlaying it. within that div I have 2 more divs. Both should overlay the IMG, but for some reason only the first DIV overlays correctly...and the 2nd does not. It refuses to overlay my IMG. Both are children of a DIV that is overlaying the IMG.
This seems to be only a problem in IE8 Compatibility Mode...so I guess that means it also looks bad in IE7. You can toggle Compatibilty mode off and on to see the problem and I've added color to my DIV backgrounds so you can see the issue better.
Safari and Firefox work fine.