runat=server must be there or it won't work.
Please note that position is important.
<portal:StyleSheet id="StyleSheet" runat="server" />
<portal:IEStyleIncludes id="IEStyleIncludes1" runat="server" />
In order to work the IEStyleIncludes must be below the main style sheets.
The IE7Specific.css file in your skin folder should only contain things needed to fix rendering in IE 7
The IESpecific.css file should only contain things needed to fix rendering in IE 6
I would try putting a border on something to make sure its working. You may also need to clear your browser cache periodically to get it to load the updates css files as you make changes.
Hope it helps,