Ahha! While I take on board all the comments regarding browser compatibility etc.... I have done some more digging and fiddling around... the issue is more one of curiosity I.e. How come the Original PNG file has transparency layer in i.e.6 but the one I've created in PDN doesn't.
after more scratching of my head I have discovered that this has something to do with colour modes. As i couldn't find any differences in PDN attributes, I opened the file in GIMP and noticed that one was using "Indexed" and the other (PDN Image) was showing "RGB". Gimp has a function to switch the modes from RGB, GrayScale and Indexed. I Used Gimp to Switch to index mode saved the file and uploaded to the website and hey presto! it worked...
I could not find a simmilar fuction or switch in PDN?
Many thanks to all who responded and I hope this helps anyone else who comes across simmilar