Can you blit with masks (transparency) directly to a form (not in a control)

I haven't made a custom user control yet since I'm just messing around with an idea.

I have a plain form and I blit the mask of an image to it with vbSrcPaint. I then blit the actual image to the same location with vbSrcAnd (as per the instructions I read).

Now if I blit another mask to the same location ( a different sprite ) with vbSrcPain and then another sprite on top of that with vbSrcAnd I want to be able to part of the first sprite underneath the 2nd.

However, this is not what is happening. The 2nd sprite just overwrites the 1st and I see the gray of the form in the transparent areas.

What is wrong with my process?

actually it seems to be blitting the background color of the picture object that is currently holding the sprite to the form.

I have the picture object set to transparent and that part seems to be working, but the blit is carrying the picture backcolor.

How do I circumvent this?