On this page, the light blue square is an absolutely positioned DIV with a z-index of 10. The "Empty" square is actually an IFrame, that loads a page consisting of the word "Empty". The lower square is a textarea, in which we will display messages. Both the DIV and the IFrame have mouseover/mouseouts attached to them that will display a message in the textarea when they are triggered.
In Safari 1.2, note that when you roll over the blue box the DIV mouseover message is displayed. If you keep going, however, rolling over the IFrame border that is beneath the blue box, the DIV's mouseout is triggered--even though the mouse is still visibly within the blue box. The DIV Mouseover will not be retriggered until you roll back "outside" the IFrame. In Safari 1.3 these problems are not present; however, the DIV mouseout message is not displayed until the mouse leaves both the blue box and the IFrame border (as long as the mouse remains within the IFrame border the DIV mouseout doesn't fire).
In Mozilla, rolling over the unseen frame border does trigger a mouseout; but if you continue past the border, the mouseover for the DIV is retriggered (but not until you clear the IFrame border). Note also that in Mozilla, rolling off the blue box within the IFrame will trigger a mouseover of the IFrame, but NOT a mouseout of the blue DIV.