Photoshop png or smart object bug

The Devon graphic looks like it has had a white background selected and removed.

A file opened as a PNG won't have any vector content, so as c.p. says, there was no point in using Illustrator.

However it could have had transparency, but the is evidence of lighter coloured aliasing, which suggests it was a raster layer at some point.

If the graphic does exist as a vector object, then what I do is combine it with any other layers that are part of the overall graphic, and make them a Smart Object. And then drag that SO to a CC Library.  That makes it always available.

[EDIT]  I meant to say that when uploading screen shots, can you leave them at full res, and think about what is visible or hidden behind open menus and panels etc.  Things like zoom ratio in the Status Bar, and document tab along with image mode and bit depth. 

Thanks for trying to help, Daniel.  As I said, the problem is not with the png file. The problem is with my PS display.   I'm a professional artist who's used PS for 15 years, please trust me that I am demonstrating a problem that is isolated to my PS display. 

My Devon logo is artwork originally created in AI and I use it in several places as a png with an alpha channel.  The original AI file is fine, the png is fine in other programs.  I was just using that as an example to demonstrate the problem. I'm starting to think PS is having a specific problem with files with alpha channels. See the new screenshot below.  On the left, I've opened 3 png files in PS (all with alpha channels.) On the right, I've opened the very same three PNG files in windows photo viewer.  I've also opened the very same logo png file that is displaying as a red block in PS.  If you look at the shoulder anatomy image on the far left, you'll see some squiggles with white blocks around them.  This is what happens when I use the paintbrush in that file. My strokes are pixelated and the white blocks appear spontaneously. I have tested drawing with the paintbrush in a new PS file and there are no problems.

I have already tried the following:

• Un/reinstalled PS from CC
• Disabled my graphic processor in preferences > performance (did not correct the problem)
• Updated my graphics card drivers anyway (no effect)
• Obviously, restarted my computer several times
• I use a Wacom pen tablet and over the years have noticed glitchy behavior, but nothing like this

Your considered help would be appreciated.