Ahh - might have misinterpreted the OP's question...
What I was referring to was setting parts of the image as transparent
- for example just showing a track/road or something like that - which
would be done in the image itself.
However if you want to actually change the opacity of the image
overlay, as you can do in the standalone GE application by dragging
the transparency bar, then there looks like there is a way to do that
in the GE Plugin.
I haven't tried this myself - don't have the need - but maybe this
will help you Shea...
Both ground and photo overlays are part of the KMLOverlay object
http://code.google.com/apis/earth/documentation/reference/interface_kml_overlay.html
..which has a getColor function.
Within that it seems you can specify 4 values using the Set function -
the last of which is "void KmlColor.setA(int a)" for the Alpha channel
(opacity) - see
http://code.google.com/apis/earth/documentation/reference/interface_kml_color.html
So it looks like there is a way and although as I say I haven't tried
it myself that's where I'd start.
Would be interested to know if that works out.
Regards
Nymor