I'm having a problem in IE when the content of a list item wraps onto a second line the bullet appears against the bottom line of the list item, in firefox and opera it appears at the top where it belongs
Not on a standard unordered list it doesn't! Have you done anything with custom bullets, alignment, styles etc? At any rate: can you supply markup/styles or a link to the page in question?
Your style rules are a bit confusing; try to reduce the number of rules a bit: I saw several rules which declare properties that could be combined, and some properties are declared more then once, which makes it somewhat harder to figure out what's going on.
Anyway: you omitted the markup; based on the class names, I can make a calculated guess what's the plan, but please include the relevant markup as well so nothing gets missed.
Once you supplied the markup I can try it out for myself; the backround image used doesn't seem to play a major role, so I can make do without that one.
the .subnav and .mainnav classes are the navigation list styles,
the normal <li> declarations should have no style applied and in firefox and opera it renders without any style applied but in IE without the float:none it applies to float and list-style properties from the menu items