NDS Models: Transparent Textures appear Red/White with Random Lines...?

I want to upload more models for the games I've contributed to, but now this is happening with every model I load up.
In Edit/Object mode, anything transparent in a texture appears Red.

Edit Mode:


In Render view, anything transparent in a texture appears white (along with some black random lines/dots on certain models.)

Render View:


I need a solution to the Render view problem the most.
If you think you know how to fix this, pleeeeease heeeeelp meeeee.
Here's the blend file along with the model and its png textures.

  Cool-Tree-Draft.zip (Size: 91.29 KB / Downloads: 1)

EDIT: What is with these lines?! Does anyone know the solution to this, too?  


  Bunnie.zip (Size: 94.96 KB / Downloads: 1)