Friendly reminder
When saving/writing out your rounded images, use an extension that supports transparencies (a.k.a this will not generate rounded jpg images)
PNG-24 supports different levels of transparency. Each pixel can have an opacity between 0 and 255 (so 0 is completely transparent).
GIF and PNG-8 both use color palettes, and support transparency only in the form ON or OFF (you select which color should be transparent).
JPG does not support transparency.