Padding and borders are not applied.
Screenshot of Navbar below in IE5/Win:
[html edited to replace link wording with LINK TWO and LINK FIVE - so as not to confuse search engines]
Padding and borders are not applied.
Eric Meyer's Master Compatibility Chart at: http://webreview.com/style/css1/charts/mastergrid.shtml (under Box Properties) suggests that these only have partial support in IE5/Win.
Likewise the Richinstyle IE5 Bug page Section G, Bug 1 says: "Margins and padding don't work on inline text elements" and Section H, Bug 4 says: "IE 5 does not support borders on inline non-replaced elements". http://www.richinstyle.com/bugs/ie5.html
What it should look like: (tested in IE5/Mac, IE5.5/Win, IE6, Moz 1.1, NN6, Opera7)
Screenshot of "fixed" Navbar as above in IE5/Win is usable if not very attractive:
NOTE: the second navbar has a between LINK and TWO also LINK and FIVE, to stop the navbar wrapping at these points when the window is resized.
However, this stops the navbar from wrapping altogether which is IMO a worse problem.