imagealphablending( $targetImage, false );
imagesavealpha( $targetImage, true );

did it for me. Thanks ceejayoz.

note, the target image needs the alpha settings, not the source image.

Edit: full replacement code. See also answers below and their comments. This is not guaranteed to be be perfect in any way, but did achieve my needs at the time.

$uploadTempFile = $myField[ 'tmp_name' ]
list( $uploadWidth, $uploadHeight, $uploadType ) 
  = getimagesize( $uploadTempFile );

$srcImage = imagecreatefrompng( $uploadTempFile ); 

$targetImage = imagecreatetruecolor( 128, 128 );   
imagealphablending( $targetImage, false );
imagesavealpha( $targetImage, true );

imagecopyresampled( $targetImage, $srcImage, 
                    0, 0, 
                    0, 0, 
                    128, 128, 
                    $uploadWidth, $uploadHeight );

imagepng(  $targetImage, 'out.png', 9 );