You are right, I got things mixed up. Most of my lame encoded vbr files work fine. Heres a quote from the release notes.

"It appears that Audio Catalyst will produce files with incorrect VBR
headers if Real Player 7 is also installed. It is not possible to fast
forward or rewind such files, the time display will not update and the
player will not remember where it was in the track if powered
off. Apparently the latest version of MP3 Tag Studio can repair these files
although we have not tested it."

Sean