The observed difference is due to that we integrated the RadFileExplorer
control in the editor's File Browser dialogs in Q1 2009.
Our suggestion is to download version 2008.3 1314 or 2008.3.1504 from your account and see whether the IE8 problem is fixed in one of them. Both versions do not contain RadFileExplorer in their dialogs and your code should work.
To download the first build you should click on the Older Versions link in the Downloads section under your Client.net
account. The second build could be downloaded from the following link http://www.telerik.com/account/downloads/internal-builds.aspx
the Telerik team