I have the html:
on my website Muse Me (http://www.musememobile.com
What about if you declare a "type" for your link? Also, you can try a rel of simply "icon" in addition.
Try this:
You could also try appending the domain to the image src as well:
UPDATE
You could also try using a png for your favicon (obviously will need to have a png version to do this). This is the approach I take with my own site and it looks fine in Chrome: