I have gone over the work that I was doing and this time DXTBMP worked perfectly and Photoshop CS2 co-operated perfectly with it, what was wrong I cannot find out. The Alpha file was being loaded into CS2 OK as a Color Indexed file and I could not edit the tones of the grey images until I changed it to Greyscale. Which of course was not reloading into DXT successfully. But now all are working OK.
I guess one of those things that "just happen"
Once more my apologies and thank you for your assistance.