Photoshop CS does not have Group With Previous and Ungroup on the Layers Menu as did Photoshop 7. The feature works using shortcuts (CTL-G & Shift CTL-G in Windows), and it appears in Image Ready. Why not in Photoshop CS?
It now calls them create clipping mask and release clipping mask, but they do the same thing. And no I don't know why they changed the name and yes it confused me too at first.