Thanks. I didn't notice the lte as being a potential problem. I removed it but it didn't fix the problem.
Basically what's happening is that the ie7.css is not being applied when using IE7. To futher determine this I removed everything from layout.css file but left it all in ie7.css. I get the same result in both FF & IE7. No styling. Before that I'd tried altering height dimensions & background colors non of which were applied. Is there something weird that SS does to get this stuff working that I'm just not seeing?