I face the same problem (Joomla 2.5).

However, I can note a mistake you have. Creator specifies that you use z-index and position:relative only to anchestor element, and not the one you target.

Tell me if this fixes it.

Back again, I couldn't fix the problem with background images. The closer I went is to display some kind of a white background instead the of desired one (a transparent cool pattern from Subtle Patterns, and a brownish color behind which made a nice result).
Anyways, for anybody wants to save some time and find a temporary solution, have a look on this:
http://nicolasgallagher.com/multiple-ba ... with-css2/
pretty good solution which helped me a lot.