Colored Alpha Channels using DXTBMP and MSPaint
From FSDeveloper Wiki
In this tutorial, I will explain how to create alpha channels with colors.
1. Create your model file in your preferred modeling program. I use GMax so everything will be relative to using Gmax.
2. Create a texture with the color you want to be translucent. Make sure that you save in a 24bit bitmap. For this purpose I will name the file "example.bmp"
3. Create another texture in a shade of gray. The darker the gray, the more "see-through" the object will be. This texture must be the exact same size as the original. Save this as "alpha.bmp"
4. Open DXTBMP. Load the original file (example.bmp). Next, go to the top of the screen to the "Alpha" drop-down bar. Click "Import Alpha Channel." Find the file "alpha.bmp" and click OK.
5. Now you will save the file as your preferred FSX compatible texture (I use 32bit bmp.)
6. In Gmax, click on the Material Editor. Create a Flight Sim X material. For the diffuse texture use "example.bmp" (the original file in 24bmp). Scroll down in the Material Editor and click "Set Default Transparent." Also check "No Base Material Specular."
7. Save and export as .mdl and import using your preferred program (ADE9X, SBuilderX, etc.)