oops, you’re right, the PNG background is pure white and gets ignored. I’ve been bitten a few times by not-quite-pure-white backgrounds, so now I try to always use the transparency capability of PNG, just to be sure.
@katelynnpayne, maybe to late, but here is a link to the tutorial that @jbmanning5 wrote about this subject, and also a link to the video that I made with a different method to achieve a similar result.