yes, that certainly does look like crap!
Now, the problem is not your hardware since graphics cards have been able to do alpha-channel texturing since the 3Dfx days.
I DL’d the FPS tutorial and it too is exhibiting this same alpha texture problem with explosions, eg the first barrel in the hangar.
Hmmmm. This kind of problem is either a texture import problem, a shader problem, or an internal state problem in the guts of the rendering code (which can be hard to find).
So I first monkeyed with the texture, changing the format to ARGB, then adding an explicit alpha channel in Photoshop, but the problem was still there.
So the next thing was to look at the shader . . . and changing it from Particles/~Additive-Multiply to anything else works as expected.
Apparently there is a problem with that shader. Googling, I found this:
http://forum.unity3d.com/viewtopic.php?p=206390
which mentions this additive multiply shader having . . . issues.
I went and got the shader sources, and this line stands out:
combine previous * primary DOUBLE, one - texture * previous
I’m a shader noob but changing that to:
combine previous * primary DOUBLE, texture * previous
fixes the alpha problem! The blending doesn’t look sexy, so I’m not sure this is quite the effect the original author was going for, but it sure beats those black boxes!
I’ve attached the shader here, just create a new shader, paste in this code, and change your material to use this new shader.
221728–8040–$newshader_461.shader (851 Bytes)