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Not sure if his is right but i cropped some of the image to make it smaller (got rid of the extra white that was there and if finally gave me more options
if the image is over a certain size (30,000x30,000 i believe?) it is consider a psb and not a psd.. large document format. and these can't be saved as a jpg... so you have to shrink size or lower the resolution.
also, look at the top bar where the file name is on your file window. what does it say? some color modes do not save as .jpg. you might have accidentally changed it to "index color" etc. switch it to grayscale, rgb, or cmyk and see if it saves.
typically in PS i want save with layers as a tiff or psd, for production purposes. if i'm sending a proof to teh client, i shrink the canvas/resolution and save for web/export a low res jpeg
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