Hi all-

I recently switched over from using xterm to aterm (sweet customization), but the transparency is bugging me...

When i move or resize the aterm window, the transparent aterm background lags for about a full second or two before it readjusts the background to match the desktop...

I have 1 GB of RAM, AMD Athlon XP-M 1.67 GHz and VIA S3 UniChrome vid card configured fro 3D direct rendering...
I'm running Fedora Core 4 with the latest kernel...

There's got to be a way to smoothly adjust the transparent background when moving or resizing, or am I just delusional? Thanks all!

I don't think 3D has something to do here, but more 2D or libAfterImage (which manages the background images). I suggest you make sure you have the latest version for libAfterImage and your video card drivers as well.
aterm website: aterm.sourceforge.net/

Hammett-
Updated libAfterImage through yumex, and transparency still lags...when I updated to the latest kernel, I got the latest drivers for my vid card as well...

ugh, this is annoying...

I understand that aterm uses "transparency" in the sense that it displays a portion of the desktop background to look like it's transparent...is there a terminal emulator that uses *real* transparency?

No, real transparency is made directly from the X system. If you want real transparency, you'll need to upgrade to modulized xorg 7
I'm affraid to say I have no other clue of what may cause the problem, but you can try to use eterm instead, that has as well transparency.