Wmode="opaque" causes poor video playback in IE

Hey all,
Website in question: http://www.lavalleprinting.com/newweb/defaultsample.asp
In building a new website for my company, I've created a page where javascript drop-down menus are intended to expand over/in front of a .flv video.
wmode="opaque" or wmode="transparent" allow the menus to appear on top of the video, but cause rough playback in all versions of IE.  All other major browsers play smoothly.
If I remove the wmode parameter, the video plays smoothly in IE, but the menus appear behind it.
I've also tried reducing the bitrate of the video to an unwatchable 250kb/s, and playback is still choppy.
I'd like the video to play smoothly in IE.  Is there any hope?
<object> code below:
<object width="352" height="288" classid="clsid:D27CDB6E-AE6D-11cf-96B8-444553540000" codebase="http://download.macromedia.com/pub/shockwave/cabs/flash/swflash.cab#version=7,0,0,0" id="FLVPlayer" style="position:relative; z-index:0;">
<param name="movie" value="FLVPlayer_Progressive.swf" />
<param name="salign" value="lt" />
<param name="quality" value="high" />
<param name="scale" value="noscale" />
<param name="wmode" value="opaque" />
<param name="FlashVars" value="&MM_ComponentVersion=1&skinName=Clear_Skin_1&streamName=/Video/PressVideo&autoPlay =true&autoRewind=false" />
<embed src="FLVPlayer_Progressive.swf" flashvars="&MM_ComponentVersion=1&skinName=Clear_Skin_1&streamName=/Video/PressVideo&auto Play=true&autoRewind=false" quality="high" wmode="opaque" scale="noscale" width="352" height="288" name="FLVPlayer" salign="LT" type="application/x-shockwave-flash" pluginspage="http://www.macromedia.com/go/getflashplayer" />
</object>

I hate to 'bump' this thread, but the doomsday of deployment is coming soon and I'd like to have this bug fixed.
Has anyone else run into the same problem?  Is there some tweak I can make when encoding the .flv?

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