Well, it all depends of the image. There's different modes of DDS, as you probably know; nvDXT is the best to-DDS converter that I know of, so I'll recommend using that one. It's a command-line app, but you get used to that quickly.
Now, for alpha channels: DXT files are compressed, so take less memory, hard-disk and download space. They do have to be a power of two though.
- DXT1c saves without alpha channel
- DXT1a saves with one-bit alpha channel (fully transparent/fully opaque)
- DXT3 saves with 4-bit alpha channel ( I don't recommend using it, unless you know what you're doing)
- DXT5 has a full 8-bit alpha channel, allowing for soft blurs, like planet atmospheres and everything.
- uXXX saves uncompressed, without alpha channel (use u888, unless you know what you're doing)
- uXXXX saves uncompressed, with full alpha channel (use u8888, unless you know what you're doing)
Finally, don't generate mipmaps if you don't need them, that'll save you some space as well.