I have adobe Camera Raw version 4.0 as a plug-in. I think it was free upgrade at some point in the past. I seem to remember it was not a simple upgrade and took me some time to find and install correctly.
Not all RAWs are the same?
A while back I upgraded my Canon 20D to a 40D and the RAW files it produced would not work with CS2.
After a while, Canon I think? brought out a programme to convert them into a format that would work with the older Adobe programmes.
Worth a google?
Try Bibble http://www.bibblelabs.com. They support a HUGE number of raw formats. Sadly (for me) they've just been bought out by Corel, so their support quality is likely to plummet and updates will become unaffordable.
Bibble is a photographic workflow processor. It's not a substitute for Photoshop. But what it does, it does superbly well, IMHO, and I wouldn't be without it.
Roger has the answer. Adobe's DNG converter will convert all your raw files and then Photoshop (any version) will be able to work with them. Download it here for PC or here for MAC.
The software converts any raw file from any camera to DNG files that are all interchangeable and readable by any version of PS. The sidecar file (XMP file) data is stored inside the DNG file as well making it a bit more secure. (I've seen people delete those XMP files 'cause they didn't know what they were for and then wondered what had happened to their edits.
downloaded the file, converted the raw to DNG, went to load one into CS3 and out of the 12 i converted only 1 opened up and it was just a grey mess, looking on the open file types in CS3 they isn't a DNG file type to upload using, so now i'm stuck as what to do..
I have no idea why your files are becoming corrupted, I have used DNG converter loads of times with no problems. It's Adobe's attempt to try to find some common ground for the raw file mess that currently exists between all the different camera manufacturers.
There won't be a file type to open but if you use Bridge right click on the DNG file and chose 'Open in Camera Raw' it should open okay.
Looking at your original post, you have upgraded from Photoshop CS2 to CS3 and CS3 can definitely open anything that CS2 can open. Try running updates (on the help menu)
I'm beginning to think there must be something wrong with your Photoshop installation. CS3 will definitely work with Canon 350D raw files straight out of the box without needing updating, so you shouldn't be having any of these problems.
Un-installing and re-installing is a bit of a pain and not guaranteed to solve the problem of course. Might be worth dropping Adobe a quick email to see if they have any suggestions.