PNGU is a lib for Wii and GameCube that ‘wrap’ the famous libpng and facilitate png handling and conversions to the native Wii/GC formats. PNG format has some properties which make it interesting: A background color, a list of transparent colors, alpha channel, it doesn’t modify the colors (as jpeg do when compression), open format…

Features:

It’s based in libpng 1.2.29
Handles images of 8 and 16 bits per channel.
Handles images in RGB, RGBA, grayscale and grayscale + alpha formats.
Reads image dimensions, pixel format, background color and transparent colors list.
Converts images to YCbYCr, linear RGB565, linear RGBA8, 4×4 RGB565, 4×4 RGB5A3 and 4×4 RGBA8 formats.
Saves YCbYCr images in png RGB8 format.
Handles images stored in memory or in devoptab devices (SD, Gecko SD, etc…).
It’s ready to be used in multithreaded applications.

http://wiibrew.org/wiki/Development_Applications/PNGU