"Preserve photoshop editing capabilities" is incompatitable [error message?]

I've got a frustrating problem that is screwing up my photoshop files. The problem starts
when I try to save my file (it has numerous layers) as a pdf. When I save my file as a pdf I get a pop up message saying "Preserve photoshop editing capabilities" is incompatitable with earlier versions of Phootshop. In earlier versions, you must open the PDF as a Generic PDF (not as a Photoshop PDF). Do you want to continue?"
When I click yes, it saves the file as a pdf. BUT when I go back to open my photoshop file, all of my layers have been merged, thus making my file worthless.
I realize I somehow must have changed a setting, but Im clueless to what it might have been. Has anyone ever come across this problem? Any help would be greatly appreciated.
Thanks

Did you check the Layers option in the Save As dialog?
MTSTUNER

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