Icons - Do they need alpha channels?

[redwoodtreesprite]

I'm making an icon for the Black Knight. So his helm has the fins, and is black of course. I know how to make alpha-channeled icons, as that is needed for Morrowind. I also have no problem saving as a dds. But should I make the black area around the knight alpha-channeled, or leave it as basic black.

(And these icons will be released as a modder resource of course. )

Edit - Finished the icon, here it is compared to the Death Knight One:



Edit 2 - I can't get the icon saved in a way that Heroes 5 likes. Everything looks garbled at best, and is plain invisible at worst. What are the dds settings I need to save in for this game?