If you give the iframe a style of "background-color:transparent" it will (at least, it's supposed to) let the background of the source document show through, unless the document sourced in the iframe specifies its own background.
<html>
<body style='background-image:url(vfdt1.png)'>
<iframe src='foo.html' style='background-color:transparent'
width='200' height='200'>
</iframe>
Foo!
</body>
</html>
Foo.html:
<html><body>Bar!</body></html>
This has the advantage of not being IE-specific.