Have you tested how it looks when night changes to day? The alpha channel is used for transparency or reflectivity depending on the surface the texture is painted on. I think it would be worth checking whether this has adverse effects on lgithing conditions when not in either day or night and also on reflections on the water etc.
There was probably a good reason why there was an alpha channel on the sky, consodering they didn;t have one on things like ships (they are there in SH4), aircraft, buildings etc.
I'm not saying you might not have fixed the problem but I'd like to see some wider testing done before I'd go jumping into this edit wholeheartedly.
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