"The grayed out photos are already in the library. Select "Make extra copy in" to import them again"

I can open some other files that I've tried, just not this particular one. I've barely even used this program, so I don't recall opening this file before. I've looked in all those Smart Collection folders and whatnot, and I cannot find the file in there anywhere. If it's already in the Library then I don't know where to find it.
Anyone have any suggestions?
How can I skip all this "Library" BS? I just want to open a file, modify it, and save it. I don't want multiple copies of the same file and I don't want 'projects' and 'libraries'. Also, it doesn't seem to import GIF files?
thanks