Standards are important and there's yet another debate going on over at http://digg.com/tech_news/IE7_is_basically_non_compliant_with_CSS_web_standards with some interesting statistics presented about the amount of CSS and HTML implemented in IE. Chris Wilson has an excellent post pointing out how the results are just a little skewed!
IE7 is a considerable improvement for web developers with alot of issues fixed and support for selectors and fixed positioning added. We know we have more work to do in future versions and are not anywhere close to being done in this area. We're looking forward to it.