.dds is just a container format and some people don't have much use for things like the squish converter nor know enough about image files to know what format to change the image to.
I see no reason why it should not recognize your image files. Sometimes RB screws up so I'd quit the program and try again. What might also help would be making sure that they have the dot suffixes for their file format.
EDIT: ghosts, do you have the image you imported because all I'm getting is a pure black image.
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