IE8 not rendering transparent pngs correctly -- never happened before
If you remove the cycle plugin code, you'll see that the backgrounds become transparent. I haven't looked up why, but it's causing the problem.
Add this to the cycle options and the background will go away =)
cleartypeNoBg: true
http://jquery.malsup.com/cycle/options.html
Does PNG 24-bit transparency load in IE8 using :after pseudo-element
It's not the PNG that is the problem it's IE8's support for :after/:before pseudo elements.
Have a look here for a list of supported browsers: http://css-tricks.com/browser-support-pseudo-elements/
Apparently IE8 has "partial support":
"z-index not respected, must use a doctype, must declare a :hover state if you use :hover:after/:hover:before"
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