I have a question Steve. I'm a Corel guy and the only other program I have is PS 7, that I only use to open
customer supplied art. I have Jerri Clow's CDs for doing art and seps in PS and I use what I learned from her to do
my raster seps in Corel Photo Paint. I've never used Illy so I don't really know anything about it.
If I get any jobs that I can't handle I send them to Scott Seibel (command z) and let him work his magic(he an Illy guy).
When working in Corel Draw if I need to edit a raster file all I do is click on the Corel Photo Paint button
and PP opens with the file already loaded. I do what I have to do and hit the save button and close PP
and the new file is already there in Draw.
My question is do Illy and PS work the same way. Can you work in both programs at the same time with the same file
like in Corel Draw and Photo Paint? Does Illy work with monochrome bitmaps? Sorry if these are stupid question but like
I mentioned earlier I have never use Illy and my PS is almost as old as you 
PS as old as me is more likely to stand for "Public School" instead of Photoshop.

If I want to edit the raster in Illy, I just go back to the source file in PS, just as you do in Photo Paint. Hit save, and going back to Illy, we get a message saying the file has been updated. And yes, Illy will work with monochrome bitmaps, or in other words, black and white with no grays. In Illy, when you import (they call it "Place") one of those, you can assign a color to it, and spot color you make up, or PMS, or CMYK mix.