It looks fine in IE8 for me on this end. When I view it in IE7 the images are scooted over though.
It appears that your using the new HTML5 nav as a list. See nav here
. It can hold anchors or hold a list but it is not a list itself so you need to use ul like you used to.
There is a new HTML5 menu tag
you could use in place of the nav you're using now.
Not sure IE7 will know what to do with the menu tag. Support for HTML5 is not that great yet.