And old question, I know, but I just ran into this myself. The issue is IE's tendency to ignore transparent elements (see this SO for more details). I was able to hack a fix on your fiddle by adding a white background color (with opacity set to 0) to the table's parent div.
Here's the updated fiddle: http://jsfiddle.net/z5BCm/1/ Specifically, here's what changed:
<div style="left: 0px; top: 0px; width: 663px; height: 574px; display: block; position: absolute; z-index: 99998; background-color: white; opacity:0;">