Alright well I did some fiddling around, and I got it to work 
Thanks for all your help

Yep, it's definitely DK that's causing the problem. I tried using transparency on some other characters and it turned out fine.

Still same problem, I'm starting to wonder if its a problem with the specific sheet I'm working on (DK's body)
I'll try something else

What do you mean by that? And is it necessary to remove the alpha channel when making a +2 texture transparent? 'Cause that's something I haven't been doing.

Anyone?

That helps, but now when I add the magenta in the parts meant to be transparent, everything seems to go fine in ASH, but it ends up churning out a 0KB .pcs
Anyone got a fix for this?

Great, works now. Just one more thing, how do I add transparency on these?

So, I'm probably just one of the many who've ran around asking for help with indexed textures.

I'm currently using GIMP for my textures, and had been just ignoring the indexed textures until I decided I wanted to make a texture for Donkey Kong. So I extracted his .pac and to my disappointment found that almost every single one of his textures are indexed. So I did some digging around and found that apparently Photoshop will allow me to fix these rather bothersome indexed textures.

Could anyone explain to me exactly how to do this and what version of Photoshop I'd need?
Thanks.