It looks like:
ul#cssmw0 ul.level-1 > li > span > a {
needs a width to work properly in ie7 possibly.
You could try setting z-index in the menu to force it on top, but it appears the missing width may be the culprit.
Your friends over here at WebAssist! These Dreamweaver extensions will assist you in building unlimited, custom websites.
These out-of-the-box solutions provide you proven, tested applications that can be up and running now. Build a store, a gallery, or a web-based email solution.