Here's something that I just received from Jeff (DH support) which might be very useful for you:
"You need to run as php-cgi instead of just php. To do so, create an .htaccess file in your home or domain directory with the following line::
AddType php-cgi php
info found here: https://panel.dreamhost.com/kbase/index.cgi?area=2526
That should clear up any errors if your files are in the right location with the proper permissions."