To do transparency, you need to use a graphics program that is designed to support multiple layers or images with an "alpha" channel. MS Paint is not the best in the world for this. Use something like Photoshop or PaintShop Pro 7/8/9/10 or freeware/shareware tools such GIMP or LView Pro. You can do a google search for Gimp or LView Pro.

The Help file in the software for the older NG remotes (ProntoProEdit NG software package) describes how to create tranparent images using PSP or Photoshop.