Nvidia has a .dds photoshop plugin that works with 32bit photoshop.
I can open dds files, but when I tried saving as dds it wouldn't allow me for unknown reason. So I use TheCompressonator instead for saving to .dds file format.
I have been doing this so far:
a) Load dds file into photoshop and rework the image
b) Save as Tif
c) Load tif into Ati's "TheCompressonator" (32bit and 64bit software) and do "save as original = save as" to store file as dds file.
d) I preview dds files in windows with TheCompressonator.
When viewing dds files in TheCompressonator, make sure to right click the image and switch to RGBA if the file has an alpha channel, or stick with default RGB if the file has no alpha channel. Right clicking the image offer three modes. RGB, RGBA & Alpha.
http://developer.nvidia.com/object/p...s_plugins.html (I think this is the phtososhp plugin)
http://ati.amd.com/developer/compressonator.html
TheCompressonator is available if one register on Amd/Ati's developer website, no confirmation email is even required. Just register and you can download their tools.