Strange Layer Style Behavior CS3

I'm having a problem with creating a custom layer style. When I click the layer style button at the bottom of the layer pallet, or chiise a layer style from the Layers menu) Photoshop does not open the Layer Styles dialog box. It instead applys some sort of default style and I see a message in the top tool bar that says "Click and drag to reposition the effect." Double-clicking the layer in the Layers Pallet switches to the hand tool and disables most menu functions. I either have to hit Enter or Cmd-Period to cancel and return to normal functionality.
Is this some arcaine setting I've never encountered before, or is PS broken? The problem seems to have started after I ran the OS X Software Update yesterday-- I'm using OS X 10.4.11. I also recently switched my Workplace setting from a custom two-monitor pallet layout to a single monitor default layout.
Thanks--

It seems like the layer effects dialog is popping up off-screen somewhere... When you double-click on a layer with styles/effects applied to it, it usually pops that up, and then if you mouse over the image while that's up, you get the hand tool and allows you to drag to reposition the effect.
That would also explain the disabling of the menu items, that also happens when the layer styles dialog box pops up.
I'm not sure how you go about fixing that, though... I would try saving your workspace layout as something else, and then hitting window>workspace>"reset palette locations" or "reset menus" (although you'll probably lose any custom menu stuff that way) and I would also try applying other default workspaces.
Best of luck!
-Caleb

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