I\'ve just determined using Firebug that when Fancybox window is created it actually takes all of my ASP.NET controls (contained in DIV tag) and puts them outside FORM tag.
You need to change this (somewhere around line 719 of jquery.fancybox-1.3.1.js):
$('body').append( tmp = $(''), loading = $(''), overlay = $(''), wrap = $('') );
to
$('form').append( tmp = $(''), loading = $(''), overlay = $(''), wrap = $('') );