Square wheels?? What am I overlooking? please help

[Gametech]

I'm making a skin for us2freight6 boxcar. No problem. I didn't have any problem with the Frisco skin I made. This one appears to be fine until I test it out in the game, and I come up with square wheels, and this black frame around the handle on the end. As far as I know I didn't touch anything around the wheels when making this. (I tried it like four different times) Included is a picture to show you what I'm talking about.

[Gametech]

Here's the image I was referring to.
http://forums.flightsim.com/dcforum/User_files/3b20876b2e143639.jpg

[controll]

I had the same problem with my skins and I was instructed by nels to use a graphics editing program that work with ALPHA channels, Paint Shop 7.0 works well. It's a matter of the transparency being on a separate part (background) of the image and some programs, PhotoImpact 6.0, don't handle the ALPHA channel so as to save the transparency.

Hope this helps,

Controll