DVD Menu Studio is used to design the menu and export to a format for another application to author it to a DVD. Since it can export as a PSD, it contains the subpicture highlights. You can import this into DVDLab for authoring to a DVD. No need to use Adobe Photoshop.
btw, there are many authoring apps (freeware and commercial) that can create menus directly, you don’t have to use DVD Menu Studio.
Are you designing your own menu or customizing the DvdReMake menu? At any rate, this guide will help you in replacing menu: http://www.dimadsoft.com/dvdremakepro/ht_customize_menu_full.php