I think I saw Terry demonstrate a feature in Photoshop CS3 that allowed you to scale and align 2 images down to the pixel. For example, you scale down and image in a document, then later you bring in another copy of that same image, maybe its just a different color, but everything else is identical. I want to scale it down exactly the same percentage and align it exactly right on top of the other image. Does anyone know how that works or am I dreaming?

In Photoshop CS3? I know that of the image dimensions and resolution is identical you can have the "move" tool selected and then holding the
"shift" key , just drag one image over another and that will land id precisely centered.

As far as auto scaling ? not sure of that one (yet)

I wasn't dreaming. I just found it. Select the two layers. Choose Edit/ Auto-Align layers. Wha-la!!

oh ok.