Strategy to render shadows

Won't be much help but the Zombieblast demo has the same problem. I'd suggest putting something on gamedev.net as, I think, you'll have to get into the 'SetRenderState' (for DX) level.
<edit> For OGL glBlendFunc( GL_SRC_ALPHA, GL_ONE_MINUS_SRC_ALPHA )?
<edit2> Shame there was no response to this