Which color mode in psd cs4 is best to use for 2-color project, grayscale or cmyk?

The project is a photo montage. It was 4-color, now must become 2 colors.
So I've changed each of the original 4-color photos (jpg and eps) into separate psd files (as grayscale/duotone/montage-and assigned it One pantone color)
In a new psd "montage"  file, I plan to place each photo on its own layer, adjust tints, transparency, etc, to  create one new montage/flattened.
I'm not sure which color mode is best when setting up this new file, CMYK or grayscale?
Once the PS  doc is done, the job will be saved as a PDF for 2-color printing.
I want to insure the 2 pantone colors separate properly at press.
any advise how how to best achieve this?

Yes it is possible in InDesign. You will have to judge whether you feel more proficient in doing something new in Photoshop or in InDesign.
If you restrict this to being done in Photoshop, you just need to change the color mode to duotone and export the PDF file with the 'high quality print' profile or similar. Some other PDF settings may convert your duotone to a regular CMYK or RGB image.

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