Thanks Rod,they did with the CleanPreferencesWin.bat file. (I made sure, not my first rodeo
)
I have noticed that the issue mainly occurs if one moves his cursor rapidly over multiple buttons. I use a trackball and have a bad habit of moving my cursor quickly. I had a colleague test a exe publish with her standard mouse and she did not experience the effect until I asked her to deliberately move the cursor rapidly.
Here is a screenshot displaying the defect.

The lighter blue is the normal state and the darker blue is the RollOver state.
Here is the multi-state set up:
All the buttons are set up the same way.
Kurt,
Looks like you may have discovered a bug. I suggest you log this issue with Adobe. I have no quick fixes I can offer. I think you are correct that the issue is caused by the speed with which you are accessing the objects. The browser is detecting the mouseover event but seems to be missing the mouseout event that follows immediately thereafter.
Does this happen with other browsers? You may find that it is just IE that has this issue.