Robert,

You can do this by creating a pipe image for the | and setting it as the background image for the li's in the menu, make sure it's aligned to the right, and also that you've got 1 px more padding on the right than the left (this will make the spacing between the links equal on both sides). For the last item, the list version of the NAV skin object adds a .last class so you can remove the background image on that one.

For the sub menu items, just make sure you use ul ul li and set their background images to none.

Hope this makes sense, if not just drop me an email and I'll clarify anything that doesn't.

Rick.