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Transparent PNG's?

Need some advice... I'm working on a project for/with my mom for her Red Hat group, and I really need to be able to create transparent PNG's. Because I was working heavily with web development and design, I've always been a Photoshop user. But, as the boys came along, I stopped working so much... and stopped upgrading my software (directly related to diminished income stream, of course). So, I've got Photoshop 5 installed. While it supports transparent gifts, that won't really give me the quality I need. And Photoshop 5 doesn't handle transparent PNG's. So, I'm left with the need to upgrade to the current version of Photoshop - or, it looks like I could go with Photoshop Elements. But, I don't know anything about Elements. It looks like it's geared towards helping with photo collections, but what I've read is that it should enable me to make the transparent PNG's. Are any of you Photoshop Elements users? I'd love to hear your thoughts. Because I work so much with photography, I'm curious about it... Advice needed.

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