I would NOT say that GIMP is BETTER than Photoshop. In my world "as powerful as" and free tops shelling out $700 any day. But I will partially retract that "Best" comment: I did just visit the Photoshop web site and would have to say that they have some reeeeeaalllly neat new features in the brand new CS2 release. I would have to agree that for high end users, the new PhotoShop looks pretty darned awesome.
when you make "new" you can choose Content:White paper,Background or Transparent...
Photoshop is VERY powerful... Especially CS2, vanishing point is awesome! :)