This sounded so much like a hoax I had to check it out. Turns out it appears to be legit. It's difficult to find the action, since it appears all traces on Reddit have been deleted. I did find a dupe post on Mediafire which I assume is the original.
All it does is execute a Photoshop "revert" command. I had never heard of that, but there it is under the File menu. All "revert" does is reopen the last saved version of the document, while magically preserving the current version somewhere (so you can do an "undo"). So if you open, blast away with liquify and warp, and then "revert", the original comes back. But if you open a document that has previously been blasted, nothing happens.
Cute, but what I found more interesting is the flagrant plagarism surrounding this event. When you Google "Dove Beautify Action", you get led to tons of blogs and news sites, where the story is repeated virtually word-for-word with no credit to the original author. I'm not even sure who the original author is.
The Dove "beautify" message is certainly bothersome for many people, but the plagarism it uncovered seems much more disturbing to me. Yes, women should not trust most of the magazine images they see, but the event tells all of us we should not trust most of the "news" we read on the internet.