My nav menu is not working properly in IE8

Question

My nav menu (all css) is not properly working in IE8 (no surprise). The submenu (under contact) seems to disappear when you attempt to hover & try to select on it. Not sure if it's a z-index thing or not. The menu works just fine in firefox, safari, chrome, and opera (of course). All code for the site has been validated and revalidated. I work in Dreamweaver CS4.
No matter what I do, IE always seems to give me issues.
The nav code is below. Here is the link: http://www.americaneaglesteel.com/
Thanks, in advance, for the help.
BRD
#navigation{
width:100%;
height:30px;
background-image: url(images/aestabgroup.png);
background-repeat: no-repeat;
#navigation ul
          margin:0px;
          padding:0px;
          font-family:Arial, Helvetica, sans-serif;
#navigation ul li
          display:inline;
          height:30px;
          float:left;
          list-style:none;
          margin-left:0px;
          position:relative;
          width: 132px;
          padding-top: 7px;
          text-align:center;
          z-index: 1;
#navigation li a
          color:#fff;
          text-decoration:none;
          letter-spacing: 1px;
#navigation li a:hover
{text-decoration:none;
color:#ccc; }
#navigation li ul
          margin:0px;
          padding:0px;
          display:none;
          position:absolute;
          left:12px;
          top:32px;
          width: 133px;
          font-size: 90%;
          background-color: #a41414;
          text-align: center;
          line-height: 160%;
          z-index: 2;
#navigation li:hover ul
display:block;
width:133px
#navigation li li
          list-style:none;
          display:block;
          border-color: #FFF;
          border-style: solid;
          border-width: 1px;
#navigation li li a
          color:#fff;
          text-decoration:none;
#navigation li li a:hover
text-decoration:none;
color:#ccc;

Answer 1

I see the menu when the browser window is wider than about 1180px.<br />
If the window is smaller than I get the menu button.<br />
In Google Chrome this works the same.
A good place to ask advice about web development is at the mozillaZine "Web Development/Standards Evangelism" forum.
*http://forums.mozillazine.org/viewforum.php?f=25
The helpers at that forum are more knowledgeable about web development issues.<br>
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