On to the second heart.  This will cover several problems, including white around the edges.  I'm going to make this heart two different ways to begin.  I'll do one where I just paste the mouse into the selection, another where I have merged the mouse image and flattened it with a background color I like, a light blue.  Now see what happens when you go to Proof after you have done all the reducing and stuff?  The mouse that had no background does not look right.  You need to have some kind of a background on the image you are going to Paste Into Selection.  You can't use an image with a transparent background or it will look like something ate part of your heart on the inside.

Now here is my mouse with the blue background.  It seems ok with the proofing, right?

 
 

Click here to see finished mouse hearts.

What you saw was 3 different mouse gif files.  The first one had white around it.  The second didn't, but it did have some jaggy edges.  The third one seemed nice and smooth.  What was different about these three?  The first one was done exactly from the steps above.  So how did I get rid of the white on the second one?

You have to do some deleting.  Make the heart layer active.  Click on the background with the wand.  Go to Selections.  Modify/Expand by 3 pixels.  Hit Delete.  Make the image layer active.  Click on the background with the wand.  Go to Selections.  Modify/Expand by 2 pixels.  Hit delete.