Just upgraded to 10.04 from 9.10 and noticed the same issue.

Just noticed though that switching the radio boxes on the Background tab
got it working. I switched from Transparent (the state when i upgraded
from 9.10) to Solid Color and then to Background Image and the
transparency bar started working.

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GNOME Terminal Ignores Its Transparency Settings
https://bugs.launchpad.net/bugs/572649
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