Last Thursday Strawberry Singh did a tutorial on how to make a cutout for making Flat Whoevers. See: Making a Flat Cutout for Second Life using Photoshop. The tutorial is simple and straight forward. You get everything you need to know to make a decent cutout. But, there are some Photoshop tools that make the process much easier and provide a much better result.
The new Photoshop CC and CS6 (think it is in CS5.5 too) have a feature called Refine Edge. If you are trying to trim hair or fur out of a background, you have to learn about this tool. Check out the 10 minute video.
The video is made by Howard Pinsky. It is on the pro side, which for me means no rambling, tangents, or umm-haa’s. It is to the point, clear, and crisp. I subscribed to his channel. If you use Photoshop and are still learning, and who isn’t still learning, then this is a good channel for you.
Strawberry made a clear texture 512×512. Since texture size and use is currently such a big issue I want to point out some things about this clear 512×512 image.
First off, Strawberry picked the PNG or ping format. PNG handles transparency and lossless compression, so it’s a good choice. You can read about the technical details of PNG here. Suffice to say it is an efficient format to use. The file will be small, download quickly, and not use much video memory.
HOWEVER, if you really want to save load on SL, avoid using a texture at all. Set the texture on the clear faces to none/blank and turn the transparency to 100%. There will be no download and the viewer will NOT hand off a texture to the video card. You cannot get any more efficient than that.
See the SL Wiki for Tips and Tricks for Texture Optimization.