A great thing about all of the wonderful visual effects of PPT 2007 is that they respect the transparency/alpha area of a .png image. As example here is a quick sample image. In photoshop I dropped out the background around the little computer guy and saved out the image as .png with transparency.
For this example I added the background image behind part of the computer guy to show the transpency area.
Then I selected the computer guy image and applied a nice PPT 2007drop shadow.
Note the drop shadow contours to the computer guy image, not the rectangle shape of the placed image!
– Troy @ TLC