flash (macromedia): I'm rather new to Illustrator CS2 but I had a plan to take png images (with
transparent backgrounds) into it from Photoshop and then using Live Trace
convert them to vectors. I would then export them into Flash as swf files.
(AI and AEP are huge. Or maybe I am missing something) It all worked great
until I noticed that the swf files had a white background(like when you save a
transparent psd as a jpeg and not a png.)

My question is, is there a way to make and preserve transparent backgrounds
from placed png images in Illustrator and Live Trace so that when I move them
into Flash I have a "vector png" to work with? Thanks

Found solution -After you have done the Live Trace In Illustrator CS2 , click
on the background white object and go to the Select menu > Same > Fill Color.
With all your white object selected, press the Delete key on your keyboard.
Export as an .swf. Import into Flash and you have a vector copy (with
transparent background) of your bitmap .png to play with. A "vector png"!

Embarrassed by how little I know about Illustrator... But this might help
someone:embarrassment;