What is displayed is correct for that file. The color data of the image is a thick white border around a large black area with the blue for the monitor. The alpha channel contains most of the contour and is the only place that the monitor outline, keyboard and mouse are even visible.
Morpheus can render the alpha channel if you want, and can alter it based on a threshold as well. You can set those options in the Timeline Options window.
All of the picture windows and preview window will display the color data only (24bit, not 32bit, so the alpha is ignored when displaying, but it still exists and is computed). No blending is done, because that changes the colors. You want the colors to be preserved when you render to a file where you want to morph and preserve the alpha channel. Then, when that animation is displayed, the alpha channel will be blended by the viewer.
You can see a pretty boring morph I made just now at
http://gallery.morpheussoftware.net/view.php?i=vl8BAA
I loaded that image into both picture boxes, and set the option to morph the alpha channel and changed the threshold to 0.
Here are samples of the same thing, but with the threshold at 128:
http://gallery.morpheussoftware.net/view.php?i=v18BAA
And without morphing the alpha channel:
http://gallery.morpheussoftware.net/view.php?i=wF8BAA