I did look at the file you posted and it was lacking the descriptions and thumbnail photos, so I guessed you were using an old version of calibre. If you generated that with calibre there is something wrong with your recipe or installation because it works for me.
EDIT: I just loaded your mobi again and I see it has the redundant "Next | Section Menu | Main Menu | Previous" navigation at the top of the first page of each article. This means you didn't have the output profile set to Kindle because if you did that navigation bar wouldn't be there. So I suggest you make sure your output profile is set to Kindle and try again (although I'm not aware of any differences the profile determines except the removal of this redundant navigation)
Last edited by nickredding; 10-08-2012 at 09:06 PM.