Okay, so here is the latest. Thank you David for pointing out the open div's (as an amateur I didn't realize a <div class> represented an open <div> - shame on me I know). I've cleaned up the code and have run it through the validator. No errors except alt tags that I haven't set up yet and should have no impact on browser display.
Tom, thanks for pointing out that it displays incorrectly in both browsers. I just updated IE last night and you are right. It's not an issue isolated to Firefox.
Paintbrush, I even took your suggestion and changed the image files to .png's. Still no luck. And, from what I've read online, it is OK to have absolutely position elements in a container based on relative positioning because the absolute position is absolute within that container, but I could have been mislead so I'd love some feedback on that. Paintbrush and Jewelcraft, I too spend some time in VSD but I have found that some of the things I'm trying to accomplish cannot be accomplished there AND some of the "bad" code that David and Tom pointed out in earlier parts of this thread was code that was inserted by VSD not code I wrote myself.
At the end of the day, I've got clean code now and still cannot figure out how to get the positioning correct. The new page and source code has been uploaded to:
www.thinkpawsitivedogsnacks.com/tempindex.html
Any ideas?