I tried this in DNN 4.3.4 and 4.3.7 and they both didn't work for me. Here is what the problem is:

Whenever i create a CSS class like the one below

.figure {
 float:left;
 border: 2px dotted #CCCCCC;
 margin:10px;
 padding:10px;
}

and assign it to an image like <img src="http://images.lipsum.com/images/lorem.gif" class="figure" /> then the padding does not work. If I put the image in a div tag like this

<div id="figure"><img src="http://images.lipsum.com/images/lorem.gif" class="figure" /></div>

and then assign the figure css class to div as

#figure {
 float:left;
 border: 2px dotted #CCCCCC;
 margin:10px;
 padding:10px;
}

then the padding works. The above problems happens in IE.In Firefox it works fine. But the interesting part is: If you create an html file with the code above (the first image and figure class) and open it in IE7 the padding works fine. Any ideas?