I made it work by doing the following:

1 - Removed height:100% from the nav (this is what's causing the disappearing trick)

2 - Used position:absolute to position the nav in the proper place. this also allowed me to put the nav under the page content which is better for SEO.

I have posted the original bug here:

http://dev.studioorpheus.com/floatbug.php

Just in case someone with a lot more free time than me cares at all.

Thanks again, Linda!