Adobe Photoshop uses a proprietary clipboard format for copy and paste of
images.

All of the Office 2007 products use proprietary clipboard formats to support
their imaging requirements.

Your clients may not be happy, but you cannot control the software
requirements for third party applications.

If your application supports copy and pasting of alpha channel images, then
that is a plus for your marketing efforts.

I used your code to copy a test an alpha channel .png to the clipboard.
I was able to paste the image into Word 2007 and Excel 2007.
The image displayed with transparency.

Additionally, I dragged and dropped an alpha channel .png into Word 2007 and
did a copy to the clipboard.

The following clipboard formats were presented by Word 2007 to the
clipboard:
"Art::GVML ClipFormat"
"Bitmap"
"PNG"
"JFIF"
"GIF"
"EnhancedMetafile"
"MetaFilePict"
"Object Descriptor" ----> "Microsoft Office Word Document"

Only the first clipboard format is proprietary.  "PNG" is supported.

I am unable to reply to you latest message so I Hijacked this one!

You place an IDataObject on the clipboard.  It is mainly used by Shell
Extensions that add functionality to Explorer.

Here you go:
1) New Windows Application
2) Add MenuStrip, PictureBox, TextBox and Label
3) Add the following code:
using System;
using System.Collections.Generic;
using System.ComponentModel;
using System.Data;
using System.Drawing;
using System.Drawing.Imaging;
using System.IO;
using System.Text;
using System.Windows.Forms;

namespace CopyPastePNG
{
   public partial class Form1 : Form
   {
       private Bitmap bm;

       public Form1()
       {
           InitializeComponent();
       }

       private void UpdateFormats()
       {
           textBox1.Clear();

           foreach (string format in
System.Windows.Forms.Clipboard.GetDataObject().GetFormats())
           {
               textBox1.Text += format + "\r" + "\n";
           }

           if (textBox1.Text == "") textBox1.Text = "Clipboard is emtpy";
       }

       private void openToolStripMenuItem_Click(object sender, EventArgs e)
       {
           OpenFileDialog dlgOpen = new OpenFileDialog();

           dlgOpen.Filter = "Bitmap Files (*.bmp)|*.bmp|" +
                            "Png Files (*.png)|*.png|" +
                            "Gif Files (*.gif)|*.gif|" +
                            "Jpeg Files(*.jpg,*.jpeg)|*.jpg;*.jpeg|" +
                            "Tiff Files(*.tif,*.tiff)|*.tif;*.tiff";
           dlgOpen.FilterIndex = 1;
           dlgOpen.ShowReadOnly = true;
           dlgOpen.CheckFileExists = true;

           if (dlgOpen.ShowDialog() == DialogResult.Cancel)
               return;

           string fileName = dlgOpen.FileName;

           if (null != this.bm)
           {
               bm.Dispose();
               this.bm = null;
           }

           using (FileStream fs = new FileStream(fileName, FileMode.Open))
           {
               Cursor oldCursor = Cursor.Current;
               Cursor.Current = Cursors.WaitCursor;

               try
               {
                   this.bm = new Bitmap(fs, false);
                   pictureBox1.Image = this.bm;
               }
               finally
               {
                   Cursor.Current = oldCursor;
               }

               fs.Close();
           }

       }

       private void Form1_Load(object sender, EventArgs e)
       {
           this.bm = null;
       }

       private void Form1_Paint(object sender, PaintEventArgs e)
       {

       }

       private void copyToolStripMenuItem1_Click(object sender, EventArgs
e)
       {
           if (null != this.bm)
           {
               MemoryStream ms = new MemoryStream();
               this.bm.Save(ms, ImageFormat.Png);
               IDataObject dataObject = new DataObject();
               dataObject.SetData("PNG", false, ms);
               System.Windows.Forms.Clipboard.Clear();
               System.Windows.Forms.Clipboard.SetDataObject(dataObject,
false);
           }

           UpdateFormats();
       }

       private void pasteToolStripMenuItem_Click(object sender, EventArgs
e)
       {
           IDataObject idataObj =
System.Windows.Forms.Clipboard.GetDataObject();
           UpdateFormats();
           if (idataObj.GetDataPresent("PNG"))
           {
               MemoryStream ms = (MemoryStream)idataObj.GetData("PNG");

               if (this.bm != null)
               {
                   this.bm.Dispose();
                   this.bm = null;
               }

               this.bm = (Bitmap)Bitmap.FromStream(ms);
               pictureBox1.Image = this.bm;
               pictureBox1.Invalidate();
           }
       }

       private void exitToolStripMenuItem_Click(object sender, EventArgs e)
       {
           Close();
       }

       private void Form1_FormClosed(object sender, FormClosedEventArgs e)
       {
           if (null != this.bm)
               this.bm.Dispose();
       }

       private void Form1_DragEnter(object sender, DragEventArgs e)
       {
           if (e.Data.GetDataPresent(DataFormats.FileDrop))
               e.Effect = DragDropEffects.All;
           else
               e.Effect = DragDropEffects.None;
       }

       private void Form1_DragDrop(object sender, DragEventArgs e)
       {
           string[] s = (string[])e.Data.GetData(DataFormats.FileDrop,
false);

           if (s.Length != 0)
           {
               if (null != this.bm)
               {
                   this.bm.Dispose();
                   this.bm = null;
               }

               using (FileStream fs = new FileStream(s[0], FileMode.Open))
               {
                   Cursor oldCursor = Cursor.Current;
                   Cursor.Current = Cursors.WaitCursor;

                   try
                   {
                       this.bm = new Bitmap(fs, false);
                       pictureBox1.Image = this.bm;
                       pictureBox1.Invalidate();
                   }
                   finally
                   {
                       Cursor.Current = oldCursor;
                   }

                   fs.Close();
               }
           }

       }
   }
}