Hi Dan, Thanks for chiming in.
Based on earlier issues with the Now Cursor disappearing, I have Win 7 Home Premium Visual Effect set to Adjust for Best Performance, which enables all effects. I tried other settings but it had no effect. I also unloaded all my custom keybindings as this has had a bearing on other issues with the behavior of the Now Marker, but this also had no effect.
For reference, I'm running the most recent driver for my nVidia card (astually still nVidia 8600GT as I have not gotten around to installing the GT630 mentioned in my signature). I could try rolling back the driver to an earlier release if you think that might have a bearing.
EDIT: To answer your other questions, reboot had no effect, and it happens regardless of the setting of On Stop Rewind to Now. The Now Cursor behavior honors this setting, but the Now Marker travels with it when the tranposrt is running in both cases.