I just feel that since IE is still the most widely used browser, they could have done a better job of implementation in IE8. Saying it's IE's fault really doesn't cut it.
Calling it as it is, if you don't have any toolbars displayed on IE where the h*ll are they going to put it. I don't know with the added security in IE8 and IE9, if they are able to do a great deal more than use the toolbar function.
I don't know if like in firefox they could have placed the icon in the status bar as some other add-ons have done, NoScript, AdBlock+, CookieMonster, etc. etc. But even so positioning of toolbars in firefox is much more flexible than in IE.
I always have the Menu Bar tool bar displayed, have got so used to it over the years, even though it can access it from the Alt key. Or that space would still be taken up by any other toolbar that you did have. There are probably a small minority that don't have any toolbars installed and active, so it really shouldn't be an issue.
Personally since I don't use IE as my default browser, I have uninstalled the WebRep toolbar anyway. If you don't like the space it takes up then I suggest you do the same and be done worrying about it.