Ok I know how to make textures transparent in MilkShape, but when I export to .X format and run it in an .EXE made with DBPro my PNG texture file has a black background.
I've also tried the "old way" of making textures transparent in MS3D by slapping on a .BMP texture with a white background and adding a secondary grayscale bitmap as the alphamap, exporting to .X and running the program -- now I see all the leaf group has white backgrounds.
It also has white backgrounds in MS3D because I have 1.7.6; I hear alphamaps were depricated in 1.7+ so I can't be sure I'm doing it right though...
Here is a picture of what is happening with the model of a tree, a bitmap texture and a grayscale alphamap:
<img src="http://img323.imageshack.us/img323/2900/imageallnounderscoresmall6fn.png" />