The behavior of dropdown i.e.overlapping other control was always a poblem for me until i found article. It occurs because the dropdownlists in IE are Windows-rendered controls, not browser-rendered controls. Effectively, all browser-rendered controls go on one layer, and the Windows-rendered controls go on their own, higher layer.
Read this article and enjoy
http://www.wwwcoder.com/main/parentid/36/site/2245/68/default.aspx
