Yeah, the rakghoul model is broken, at least for TSL anyway. No matter what you do to it, he stays solid. and even if you just do the Eraser on him he turns solid black in game. I don't know any way around it unless you can play with the effects and filters enough to make him transparent (Which I don't think will work.) I messed with it on gimp for about an hour or two, couldn't get anything near to transpearent.
Maybe somebody else knows a way around it.