Hi Clancey,
Can you describe the desired effect in more detail? I've run your sample in both Firefox and IE 8 Beta 2 and it looks like the background color is applied to both links when you point to them with the mouse.
I did notice a difference when viewing the page in IE8 Mode, but given the Firefox behavior, I'm not sure I really understood what you're trying to achieve and what's happening instead. Would you mind clarifying?
Thanks in advance...
-- Lance