There are several different ways to do this, as I'm sure you already know, but version 8 gives you more choices than the previous version. A lot of people like the background eraser, which is a pretty good tool, but I prefer the point to point selection tool, using short distances between clicks, then maybe setting the selection smooth to maybe 2 or 3, then feather by 1 or 2, then selection invert, click delete or clear, and voila you have the baby all by its cute little self.
http://www.talkgraphics.com/images/smilies/smile.gifCarolyn

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