I get the same result as profx, with IE 5.2.2 (5010.1) and Flashplayer 6.
I've just tried it on the PC (WinXP Pro, IE 6.0.2600.0) and the transparency works fine there.
By the way, the PC is on a 56k dial-up modem, the Mac is 512k cable and the page renders quicker than either browser on the Mac.