First of all, your code looks good, but you're making your functions global. They should either be local or part of the frame's table, like you do with the frame's regions/children.
Your BagBuddy_MakeMovable function is not needed, since you're only calling it once (at least so far). Just use the function's body, replacing 'self' with 'frame', your local variable.
OnLoad functions don't actually work in lua, because after calling CreateFrame(), the frame's (non-existing) OnLoad handler will have run already. Just put the code directly in the source file.
As for the alpha mode, that would be
SetBlendMode.