Easiest way to smooth out a transparent GIF that has rough edges?

[imported_Rampage]

This is my file that I'm trying to smooth out.. I've spent a few hours trying to find an easy way to do this and suppose its best to enlist the help of the AT folks.

I converted it to a PNG and blurred it in Photoshop, but the transparency doesnt seem to work right in IE6 then.

 

[Czar]

redo it using paths

 

[imported_Rampage]

paths? do you have a link?