PNG w/ transparency opens and looks horrible

I have a PNG sprite map.  85KB in size.  Took it to an online PNG crush, got it down to 29KB and it looks great.
When Photoshop (CS5 on Win7x64) opens that file, there is transparency, but the edges look miserable.  Very jagged and aliased.  The file opens in Indexed 8-bit, but even changing the mode to RGB and high bits per channel, it looks very ugly.
I browsed out to the file hosted on our website, cleared the cache and viewed just the image online through the browser.  It looks fantastic.  Refreshed page and it still looks great.  Downloaded that file to local PC, opened in PS CS5 and it's back to looking miserable.  Any ideas what I'm doing wrong here?  Is it because I took this PNG file to some online compressor that PS can read the file buy degrades its quality?

Oh wait.  Nevermind.  Seems there's a note at the very bottom of the PNG optimizer website which states that:
PS CS5 and earlier cannot properly VIEW an indexed PNG with Alpha transparency (my apparent issue).  But they also state (and I'm not sure how current this is) that no version of PS supports MAKING indexed PNG with Alpha transparency.
If that's true, I'm very surprised at Adobe.  I have no plans to upgrade to a later version of PS, but with 65-75% filesize savings, it's amazing the software doesn't have that support.

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