Gary,
Avast will not alarm you to a virus contained in a zip file until the file is unzipped and an attempt made to execute the file.
Then, Avast will sound the alarm and will want to know how you wish to handle the virus, that is, delete, move to chest or open.
The Eicar test file is used to test the virus program ONCE you attempt to execute the file.
Does Avast alarm you to the file when you attempt to open it.....
If so, then Avast is on the job.
I use Avast in my XP with Outlook, and it reacts very similar to what you describe.
I don't think anything is wrong. Avast is an excellent program and once installed, usually runs fine.
Good Luck
Other members...thoughts on this?