Try setting the EnableRoundedCorners property of the form decorator control to False. This should improve the display in IE. If that does not help or you want to keep the rounded corners of the textboxes, then you need to get an updated version of the RadControls suite (Q2 2010 SP1 is the current release). I think that the problem you are describing was reported in the Q1 2010 release and fixed in later releases.
All the best,
the Telerik team
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