As far as I know, PSP is perfectly OK for creating alpha channels. Really old versions don't...but 8.1 is fine.

Now...to be honest...I use Photoshop 5.5 ... I tried a demo of PSP 7 and didn't like the tool layout, so I switched to Photoshop.

What I did, though, when making new unit cards, was to work with an existing one. Open it up and look at it.

In photoshop, you can have it display all the layers and channels. What you should have in your texture for the unit card is an RGB part, plus a seperate black and white 'Alpha' channel. White on the alpha is solid colour, black is completly see-through.

I would suggest just trying to display that on an existing tile first.

You can then modify JUST the RGB part to change the displayed image on the card, leaving the alpha part alone. You want your unit card to be the same size as the stock ones anyway.