You have many markup errors that you should fix, for example there's a ".pun" visible in the main page on the left of the main image. In internet explorer 7 I can only see the background image, the rest is blank. The background image looks fine to, it's probably a matter of screen resolution. Back on the background repeat info you'd do like this:
body {background: url(myimage.gif) repeat-y;}
Which means that your image would be only repeated vertically.
Anyway fix the markup first, you have a few tags that ain't supported by w3c like <bold>. Furthermore PunBB uses xhtml 1.0 strict, hence you cannot use the <center> tag. You can workaround that with CSS instructions or change the doctype to transitional (but I suggest you the first). <img> tags don't have the alt attribute, it's necessary even if it's empty.
<img src="myimage.gif" width="" height="" alt="" />
Also there's a <pun_csheader> tag in your source which is probably a modified entry in the template, no idea what you meant to do with it.
Finally, comments should be
you put an extra - in both sides.
I hope this helps. Let me know.