Thanks dlemstra for the input.
So it looks like in 7.0.0.0007 and earlier, when you did a rotate, the background of the rotated image was automatically set to transparent. In 7.0.0.0008 and newer, you need to manually set the background of the image to be rotated to transparent before applying a rotate.
Strangely, I also found a scenario where when I created a new transparent image, and then composited the image to be rotated into the middle of it (also set to transparent), the background of the rotated image did not render as transparent, even though both images were set to transparent background. Not sure why.
So it looks like in 7.0.0.0007 and earlier, when you did a rotate, the background of the rotated image was automatically set to transparent. In 7.0.0.0008 and newer, you need to manually set the background of the image to be rotated to transparent before applying a rotate.
Strangely, I also found a scenario where when I created a new transparent image, and then composited the image to be rotated into the middle of it (also set to transparent), the background of the rotated image did not render as transparent, even though both images were set to transparent background. Not sure why.