The purpose of the Alpha module is to take advantage of SC's alpha ink.
Alpha is a level of transparency. Alpha=0 is transparent , alpha=1 is opaque.
The first thing, rather obvious but easy to forget is that, to see the transparency, one needs to have something to see through the picture, either the fillfore of the graphic if the showfill of the graphic is true or the other objects of the card if the showfill is false. If you set the alpha of the white area of a picture which is on a white card (or fillfore), the alpha will be set but you won't see the difference.

An example :
The original picture. I want the grayish area to be transparent (but not entirely transparent). I want to see only the bonsai but not its background.

SC offers some transparency features :
I pick an opcolor and set the ink to transparent. The color I picked is indeed transparent, I can see the brown-red fillfore of the graphic through the picture but the opcolor is ONE color and the area is not uniform thus only pixels matching exactly the opcolor are transparent. And the opcolor is entirely transparent. This is not what I want.

With the Alpha module, I pick a pixel in the grey area, then I drag the sliders to set a threshold for each component of the color space (the HSL space, in this example). All colors whose distance from the picked color is smaller than the value of the sliders will be set to the level of transparency of the alpha slider.
While dragging the H,S or L sliders, a mask is calculated from the colors of the picture. The mask is the parts of the picture where the color distance from the reference color is bigger than the thresholds (the thresholds are ANDed, to have the alpha, a pixel must meet BOTH the three sliders).

The result is much closer from what I want but not yet perfect. Some parts of the trunk and the little carpet have a color very close from the grey area thus have been set to transparent by the automatic mask. OTOH, there is a grey area at the left of the carpet which I would like transparent but its color is too far from the grey of the background.
Thus, the mask editor :
The mask is shown with levels of grey but this is just to make it easier to edit. All white pixels will be transparent, any pixel which is not white will be opaque.
Here, it is easy to see where the mask has been edited with the paint tools :

Depending of the colors of the picture, one may have better results with HSL or RGB thresholds, it requires a bit of experimentation (the sliders may be dragged with the wheel, hold down the option key to synchronize the three threshold sliders).

Finally, one can set the showfill of the alpha graphic to false and put it on top of another graphic :

It is possible to merge the pictures by copying the 2 graphics and setting the picturedata of another graphic to clipboard with the popup of the PI.

If you want a more clear idea of what the different thresholds are doing, use the color sample graphics at the right of the test alpha project. With the color wheel, it is easy to see that the H slider is an angle and that the L slider is the radius of the color wheel.