Skinning help!

Trying to make a new V8 skin for my upcoming V8 outing, but I've hit a problem.

When trying to save a DDS file, I get a "Could not save as.... .dds because of a problem with file-format module interface".

I'm using Photoshop Elements 2.0 and windows XP.

I can't get CS2 on here, because this isn't my machine, only has an 80GB HDD and yes, it's far too old to be running anything with the word photoshop in it, but it manages elements just about lol.

Anyone got any solutions as to what it might be?

And if it's un-fix-able, would anyone be able to take my PSD skin and convert it, maybe touch it up a little if it's messy?
 

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