Thanks so much for responding. The tool is Liquify, I wasn't thinking straight. I'm trying to recreate an image and origianlly tried with the ripple effect but what I was actually going after is the liquify tool, here is a photo with the whole workspace. I used the tool on the left side of the guitar (hard to see in this image) but that worked. I am assuming this is an error.
Does turning off »Use Graphics Processor« in the Performance Preferences (Photoshop > Preferences > Performance > Graphic Processor Settings) and restarting Photoshop have any bearing on the issue? (Not on the existing Layer but when applying the Filter anew.)