I don't have CS3 loaded right now, but setting the composition settings to 1fps should work just fine.
If not, you could just leave your composition frame rate at a normal framerate, and apply "Posterize Time" to your compoistion (precomp as needed).
Possible that this is a bug, but using 1 fps seems a very odd way of working in the first place. Can't you just use a more conventional framerate and then time-stretch?
Yeah, seems like a bug. My AE effort is to generate animation data for a Unity project, I'm not processing any footage. If you're interested, check out the draft at http://www.allurefx.com/Projects/Mergex/Mergex.html.
What I'm doing is animating car layers and then exporting out the keyframe data into Excel for processing and feeding to Unity. The reason I wanted a 1 fps is to be able to keyframe the animation at will and then generate 1 keyframe every sec (through keyframe assistant). If I have a higher FPS, it's going to generate that many more intermediates keyframes that I don't need because the assistant creates one keyframe/frame.
Any ideas or workarounds? Basically, please see if you have a way to generate keyframes every second for an AE animation. I guess I could write/edit a keyframe assistant or discard the extra frames in Excel, but that's going to eat too much time IMO. In any case, AE should be able to set a composition to 1 FPS, surely?