IE 8 and previous versions have known discrepancies in interpreting CSS standards. you might need some browser specific tweaks.

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Cheers from Germany,
Sebastian Leupold

   

Speed up your DNN Websites with TurboDNN

I cannot be sure but from what you say I think you may be talking about this css 
.DnnModule{margin:0 0 2em 0;}
 It took me a while to find this when my unpadded target panes had mysterious padding (when I based a new skin on the dark night skin).
 
 Ian

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Mutate and Survive

Thanks Ian, Jeff...yes that's the skin setting I changed.

However, I've reinstalled my DNN instance on my laptop here to try to demonstrate the issue and now find that it is working in IE8 as I would expect it (!).

I need now to do this on my PC at home where the problem is appearing to see if that is the solution (I hope not in a way as it would mean wasting everybody's time).

I will update later today, thanks for your help so far and patience...

Neil