It sounds like your issue is with transparency. When importing a graphic, there is an option to "select the transparent color", at which point you can click on the white surrounding him. The issue is that if there is any white in your actor, it will also become transparent. If that is the case, either change the white in your character to an off-white, change the outside to a different color that wasn't used, or save the file as a PNG or other filetype that can handle transparency and make the outside transparent yourself
(BTW, I recommend Paint.NET. It's also free and has a LOT more options than standard Paint (if using Windows).)