choster - 1:52 am on Feb 4, 2009 (gmt 0)

I presume limbo meant to suggest using an index PNG, which is often smaller than GIF.

As for the jaggies, are you exporting with a matte? In other words, if your background color is green, export the image with the matte set to green. Otherwise, your software may be exporting under the assumption the image will be placed against a white or black background, which will make the edges much more pronounced.