IE absolutely hates removing a table cell and even with everything at 0px I still find IE wants to hold onto 1px of space. If you use a CSS / Div based skin and still get this I am not sure why. haven't had trouble with IE in this matter but have had to fight with IE numerous times around table cells and that 1px.

Without being able to see the output, it is hard to assist.  However, I have had this problem recently and the solution only became apparent by tracing the CSS styles.  In general I use both IE8's Developer Tools and Firefox add-on Firebug.  Though different, with a little digging you can get either to trace the styles heirarchically and show you exactly where/how/why an element is behaving the way it is.  I recently purchased a skin that incorrectly overrode .DNNEmptyPane in skin.css and never would have found/fixed it without those tools.  Anyhow, please consider providing a link so we can see the output (and details about what specific part of the output is the problem).  Cheers - Jeremy