I guess I am still using an alpha release of Paint.Net 2.1 so I guess it is time for me to upgrade.
PaintshopPro does not sound free :)
If you haven't tried the gimp you should give it a try very powerful stuff.

>Paint.NET and PaintshopPro both have the ability to create transparent images.
>
>>>Hi All,
>>>
>>>How can I set the transparent color for an image (in a picturebox) on a windows form? I simply want the "white" areas of my picture to be transparent.
>>>
>>>Thanks,
>>
>>Gimp is one of the few freeware image processing software packages I have found that can "create" transparent images. I am not a Gimp expert but if I look really hard I am sure I can find the article I used to create a transparent image using Gimp. Paint.Net might also have that feature now.
>>
>>Einar