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I am not sure of Photoshop, but if you have any version of CorelDraw, you can try this:

Select the desired part of image in Photoshop > copy it to clipboard > paste on a new blank file on...

Just check out the RAM of your system, if it is less than 1GB, upgrade it. I had faced this problem in past but up-gradation and Re-installation bailed me out .

Hope it works for you too.
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The Corel Field Services Team in Ottawa will be organizing additional free online presentations (called webinars in the Interweb terminology) about CorelDRAW and Corel DESIGNER in April and May...

You can also try this:

Open your psd file, go to file menu and select "save for web" in dialogue box choose optimization for you image..then click on "image size" tab. Here you can change the size...

Try this:

Press<F8>[keep it pressed] and run Corel Draw x4. A dialogue box appears which prompts to reset all settings to factory default, this will definitely bring back your "preview" option.
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