You may have heard of a free program called GIMP in the past. GIMP is pretty much as close to Photoshop as you can get. I haven't tried it yet, (plan to soon so I can post a tutorial), but you supposedly can even load Photoshop brushes into GIMP.
Here is how to use (and recolor) a PNG overlay in GIMP.
Download GIMP from gimp.org and install/open. This tutorial is done on a Mac, but I have used GIMP a couple of years ago on a PC, before I owned Photoshop Elements, and I did all of my editing using it at the time.
Open GIMP and open your base image.
I'm using Austin's 2 year old photo and my "happy TWO" brush (in the PNG format) from this set.
Open up your PNG image.
Next, we need to select all of the black pixels so we can turn them white (or whatever color you want to change the overlay to). Go to Tools - Selection Tools - By Color Select.
Then, click anywhere on the black and you should see marching ants around your overlay.
Next, you want to fill with white. I have white as my background color, so I chose Edit - Fill with BG Color.
It will fill with white. Once that's done you can deselect everything.
Now, at this point you have a couple of options. You can Edit - Copy and Edit - Paste your overlay into your base image, or you can save as a white PNG. I chose this path.
Go to File - Export (this is how you save all file formats other than the working GIMP files).
Another box will pop up with some choices, I just left everything as it was and saved the file.
Now go back to your base image, and choose File - Open As Layers.
Choose your new white overlay.
Now you can use the move tool to rearrange the overlay, or the scale tool to adjust the size. When you use the scale tool, be sure to click on the little chain button so you don't lose proportions.
You can also adjust the opacity of the PNG overlay layer.
Finally, flatten your image and export it to a JPG format.
Here's the final image:
I hope this helps some of you out! :)