Marking issue as Won't Fix.
First I tried to reproduce the issue on Liferay 6.1 with Tomcat 7.0.23, but I couldn't reproduce it despite trying several times, following the exact same steps mentioned above and also some variations of them. This was tested on an actual IE7 browser on a dedicated windows XP machine and also on IE9 with IE7 compatibility mode. Then, I also tried to reproduce the issue in the same ways now using Liferay 5.2.3. Again, I wasn't able to reproduce it. Finally, I downloaded the exact same version of Liferay reported in this JIRA (Liferay 6.0.6 with Tomcat 6.0.29), and I was finally able to reproduce the issue and see IE crash and see the dialog saying that IE had stopped working and asking to either close the application or find a solution.
So, this issue does not seem to be caused by the component code itself, since it's specific to certain versions of Liferay (6.0.) and is not present in the newer versions (6.1.), suggesting a conflict with Liferay's own code. Another workaround is to simply update to Liferay 6.1.
Test case that shows issue.
Steps: