This some CSS that I use for a horizontal menu.

Maybe it will help -

#navigation{
background:url(images/nav.jpg) no-repeat bottom center;
height:44px;
line-height:44px;
}

#navigation ul
{
margin: 0;
padding: 0;
list-style-type: none;
text-align: center;
}

#navigation ul li {
display: inline;
}

#navigation ul li a
{
text-decoration: none;
padding: 15px 1em;
color: #fff;
text-transform:uppercase;
font-size:12px;
letter-spacing:1px;
}

#navigation ul li a:hover
{
color: #FFFF00;
background:url(images/nav_hover.jpg) bottom center;
}

The thing that makes it center is the ul set to center. I think that if you removed the height and line height references from "navigation" that it should wrap and horizontal center.

You can see it in action here - http://dan.idano.net

Dan