It's not specific to IE 7...i get the same thing in IE 6. Started recently for me, interestingly enough it doesn't occur on all of my workstations that are running the same version of IE Devil and Windows (XP SP2).

From searching google...err live search Smiley, this is sometimes attributed to BHO mal/spyware.

But I can't find any of that installed on to my machine, everything comes up clean, I run a pretty tight ship with my PC.