demoirize filter in photoshopCS2

I'm seeing some very strange behaviour in photoshopCS2 after running the Phase One Demoirize filter. The layers palette menu doesn't seem to work at all after using the filter. After pasting in a patch I've demoirized I can't flatten the image or duplicate layers or anything. Has anybody experienced this or know of a solution? This doesn't seem to be a problem in PS7.

Thanks,
Dave Robertson