Hi Peter,
Is the layer you are trying to distort the 'Background' layer and if so it is probably locked with a small padlock icon showing to the right of the layer?
If it is, then either turn the background layer into a normal layer by double clicking on it and then follow the on-screen instructions to convert it to a normal editable layer, or you can duplicate the background layer (Ctrl+j) and then work on the duplicate layer above the background layer, before flattening the image back down to a single background layer once again after adding your corrections to the image.
I cannot remember, but doesn't CS5 have the 'Lens Correction' filter? If so, you might find this easier to work with for correcting keystoning and it should also work with a background layer directly, without any of the need for doing the above steps
Dave