Usage for Opacity
• Sprite type of effect, such as cutting out the shape of a leaf from a polygon card.
• Making the tips of hair strands transparent.
If you leave Index of Refraction (IOR) at 1.0 both methods can give similar results, however, opacity renders faster, for sprites. Opacity will also cut out the shape completely whereas transmission will leave the reflections/speculars visible even on areas that are completely transparent. Here are two images that show the difference when rendering sprites: