I just ran across this method of how to be able to apply "normal" effects like transparency to dynamic text in flash 9. Of course using flash 10 this isn't an issue but for those of us that have to use flash 9 for some cases this really is a life saver.
The meat of it is essentially setting the BlendMode of the textField to something other than NORMAL.
var myTextField:TextField = new TextField();
var myTextFormat:TextFormat = new TextFormat();
myTextFormat.font = "Arial";
myTextField.blendMode = BlendMode.LAYER;
myTextField.text = "It works!";
myTextField.alpha = .5;
Any how.. props to the guys at rabidgadfly.com for posting a solution to a long standing pain in the butt.