With some great help and suggestions from the room I was able to reach the desired result. It is definitely possible to do this with pure CSS/HTML.
Here's the fiddle. http://jsfiddle.net/ThesisDesign/YLNHp/5/.
CSS
#parent {
position:relative;
display:inline;
float:left;
z-index: 5;
border-style:solid;
border-width:1px;
width:1400px;
height:250px;
}
.image {
position:relative;
z-index: 10;
display:inline;
float:left;
margin-right:187px;
height: 250px;
width: 250px
transition:opacity 0.5s ;
-webkit-transition:opacity 0.5s ease-out 1s;
-moz-transition:opacity 0.5s ease-out 1s;
-o-transition:opacity 0.5s ease-out 1s;
-ms-transition:opacity 0.5s ease-out 1s;
}
.overlay1 {
opacity:0;
position:absolute;
z-index: 4;
width:1109px;
height:250px;
background:rgba(0, 0, 0, 0);
top:0;
left:0;
-webkit-box-sizing:border-box;
-moz-box-sizing:border-box;
box-sizing:border-box;
text-align:center;
color:white;
padding:0px;
font-size:20px;
transition:opacity 1s ;
-webkit-transition:opacity 1s;
-moz-transition:opacity 1s;
-o-transition:opacity 1s;
-ms-transition:opacity 1s;
}
#frame1:hover .overlay1 {
opacity:1;
z-index: 9;
-moz-transform: translate(0, 0);
-webkit-transform: translate(0, 0);
-ms-transform: translate(0, 0);
-o-transform: translate(0, 0);
transform: translate(0, 0);
transition:opacity 1s ;
-webkit-transition:opacity 1s;
-moz-transition:opacity 1s;
-o-transition:opacity 1s;
-ms-transition:opacity 1s;
}
.overlay2 {
opacity:0;
position:absolute;
z-index: 4;
width:1109px;
height:250px;
background:rgba(0, 0, 0, 0);
top:0;
left:0;
-webkit-box-sizing:border-box;
-moz-box-sizing:border-box;
box-sizing:border-box;
text-align:center;
color:white;
padding:0px;
font-size:20px;
transition:opacity 1s ;
-webkit-transition:opacity 1s;
-moz-transition:opacity 1s;
-o-transition:opacity 1s;
-ms-transition:opacity 1s;
}
#frame2:hover .overlay2 {
opacity:1;
z-index: 9;
-moz-transform: translate(0, 0);
-webkit-transform: translate(0, 0);
-ms-transform: translate(0, 0);
-o-transform: translate(0, 0);
transform: translate(0, 0);
transition:opacity 1s ;
-webkit-transition:opacity 1s;
-moz-transition:opacity 1s;
-o-transition:opacity 1s;
-ms-transition:opacity 1s;
}
.overlay3 {
opacity:0;
position:absolute;
z-index: 4;
width:1109px;
height:250px;
background:rgba(0, 0, 0, 0);
top:0;
left:0;
-webkit-box-sizing:border-box;
-moz-box-sizing:border-box;
box-sizing:border-box;
text-align:center;
color:white;
padding:0px;
font-size:20px;
transition:opacity 1s ;
-webkit-transition:opacity 1s;
-moz-transition:opacity 1s;
-o-transition:opacity 1s;
-ms-transition:opacity 1s;
}
#frame3:hover .overlay3 {
opacity:1;
z-index: 9;
-moz-transform: translate(0, 0);
-webkit-transform: translate(0, 0);
-ms-transform: translate(0, 0);
-o-transform: translate(0, 0);
transform: translate(0, 0);
transition:opacity 1s ;
-webkit-transition:opacity 1s;
-moz-transition:opacity 1s;
-o-transition:opacity 1s;
-ms-transition:opacity 1s;
}
#frame1 {
display:inline-block;
}
#frame2 {
display:inline-block;
}
#frame3 {
display:inline-block;
}
#parent:hover .image {
opacity:0;
transition:opacity 0.5s ease-out 0 ;
-webkit-transition:opacity 0.5s ease-out 0s;
-moz-transition:opacity 0.5s ease-out 0s;
-o-transition:opacity 0.5s ease-out 0s;
-ms-transition:opacity 0.5s ease-out 0s;
}
#parent:hover .image:not(:hover) {
opacity:.0;
}
HTML
<div id="parent">
<div id="frame1">
<div class="image">
<img src="https://dl.dropboxusercontent.com/u/236154657/Niche-Circles1C2.png" /></div>
<div class="overlay1"><img src="https://dl.dropboxusercontent.com/u/236154657/Mouseover-
Background1d.png"/></div>
</div>
<div id="frame2">
<div class="image">
<img src="https://dl.dropboxusercontent.com/u/236154657/Niche-Circles2C2.png" /> </div>
<div class="overlay2"><img src="https://dl.dropboxusercontent.com/u/236154657/Mouseover-
Background2d.png" /></div>
</div>
<div id="frame3">
<div class="image">
<img src="https://dl.dropboxusercontent.com/u/236154657/Niche-Circles3C2.png" /></div>
<div class="overlay3"><img src="https://dl.dropboxusercontent.com/u/236154657/Mouseover-
Background3d.png" /></div>
</div>
</div>
Thanks again to everyone the helped!