Quote -  Got the same issue here and the external binary morphs are turned off.

It opens in P7 but not inP6

P7 got a bug fix in one of the SRs to prevent bad PMD files from causing a problem, but there hasn't been a backport to P6, so any PMD file that exists, is referred to by a PZ3, and is bad, P6 wont be able to open the PZ3 (the option controls only creation of PMD files, it doesn't stop Poser trying to read them).