It should open with the default application. What happens if you just double-click on the same placed object outside of InDesign?
The whole "prompt" thing makes it sound like your system's "open with" defualt was bjorked somehow.
The only "strange" situation I'm aware of that can happen is if you already have a non-default version of an app open, but the default version is NOT open.
Let's say you have ID9 as your default (but not actually running), but you have ID8 open and running because you were working on something that needed to be saved in CS6 format. If you double-click on an InDesign file, it will try to open in ID8, and give you an error message if it's an ID9 file.
If you quit ID8, and do it again, ID9 will open, since it's the default.
If you have your "real" version of Photoshop running, and double-clicking on a file that should open in PS doesn't work as expected, then you've got messed up "open with" defaults at the OS level, and InDesign is just doing what it thinks it is supposed to do.
You might have better luck resetting the path if you disconnect the backup from the system and try to do an Edit With in that configuration...
This sounded promising, but the smae thing happened. I didn't find the prefs in the same path as the link you sent. In the prefs folder, there was an InDesign folder, and a ID plist. I trashed both, and the cache folder too.
I wonder if this is handled by other adobe prefs, such as the common one?
They are jpgs, which my system defaults to open w preview, by my intention. So, if I opt double-click them from within ID, they open in Preview. That's why I was using 'edit with." therefore, the test can't be entirely done.
Double clicking ps files in the finder will always open them in the correct PS app from the boot disk. BUT, just to check, I set the open with system pref for jpgs to PS (from Preview), and it works now from indesign! so, I'll run like this as a work around, thanks!
But something got screwed up in the ID to PS path prefs, or somewhere, that it still won't work as it had been. I'd love to swich it back. But not sure how...
That's a good idea too, but no change. It does work smoothly when the b/u disk is not mounted, but I still can't navigate the 'edit with > other' command prompt to the correct PS app and have it selectable (not gray).