problem might be youre diffuse map - are you trying to create a white bear ?
if so, try to make youre diffuse map darker - for my snow texture i actually used grey with ~70% brigthness to make it look white ingame.
What i found about the alpha channel so far:
-Alpha channel of the diffuse texture is either used for a specular or alpha map.
-Alpha channel of the normal texture is used as glossiness-map on some textures, on most objects it seems to be a specular-map and
sometimes it is used as "i have no idea what this is supposed to do"-map
for example stonewall01_n.dds
Also if you want to reduce the intensity of a normal map i wouldnt mess around with single channels - create a new layer on top - fill it with 128,128,255 - and use opacity to blend it over the original normal map.