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Hi there! Because the forum you originally posted in is for beginners trying to learn the basics of Photoshop, I moved your question to the Camera Raw forum, where you'll get more specialized help.
The RW2 extension isn't important. It's the camera Make/Model which is crucial. The Lumix LX7 wasn't supported until CR 7.2 (& LR 4.2), so you can't open its Raw files directly in CS5, as the last version of CR for CS5 is 6.7.
The only way to open the newer LX7's files in your older software is by upgrading Photoshop to CS6, or using Lightroom 4.2+, or by converting its Raw files to DNG using Adobe's free DNG Converter (currently version 7.3). Sorry.
But, Adobe DNG Conveter.app lets me do the selections and I get: "The source folder does not contain any supported camera raw files"
I have the same problem.
I'm using CS6 and I just did all updates. ACR is now showing to be 220.127.116.11.
Camera is Lumix DMC-LX7 and file type is RW2.
Adobe still does not recognize or open the file.
The DMC LX7 has been supported since ACR 7.2.
What are you doing where you see the unsupported message: Are you trying to view the files in Bridge or are you using PS->File / Open (try both of these) or something else.
Can you post a download link to an example file, using www.dropbox.com or similar? Perhaps the files are corrupted, somehow, and if they don’t work for others that would be the telltale sign.
Thanks for your prompt response. It turns out one of the files was apparently corrupted. After the update, I discovered the other RW2 files opened just fine.