IE7 is fully compliant with CSS. IE6 however, isnt. It will handle roll overs like above but will blow you out when you try drop down menus, etc.
http://www.alvit.de/css-showcase/css-navigation-techniques-showcase.php
Also, try and keep the site validated as you go. Its got a lot of errors already, and doing it as you go makes life a lot easier.
For instance, you are missing info in your < img > tags, and you are also using '&' instead of the correct HTML code #amp;.
http://validator.w3.org/