I would describe my business relationship with Adobe as:
"hostage"
They annually harass me with licensing checks and questionnaires because they really hate you if you run Photoshop inside a VM (my daily driver is Linux), although it is explicitly allowed. Luckily, I don't need the Adobe software that often. But they hold a lot of important old company documents hostage in their proprietary file formats. So I can't cancel the subscription, no matter how much I'd like to.
It sort of can but all non-adobe software I know of, even commercial stuff like Affinity Photo, has spotty support for some PSD features.
Basically any given PSD will certainly load correctly in photoshop, but you're rolling the dice if you want to load it into anything else. More so if you are using more modern features.
Does it work on modern hardware running modern OS? Specifically, wondering if this was a Mac version. I could see WinX versions still running, but the Mac arch has changed significantly: 32bit -> 64bit, mactel -> AppleSI
I haven’t tried so I can’t say for sure but my hunch is that you’d have better luck running old CS versions on modern Macs with WINE, which can run 32-bit x86 Windows binaries on ARM just fine (via Rosetta).
Performance is obviously going to take a hit though. Depending on the machines in question one would probably get better results from a current gen x86 box running that same Windows version of CS1/CS2/CS3 running through WINE (or of course Windows 11, but then you’re stuck with Windows 11).
I have the offline CS3 Mac version too, but it's 32-bit Intel so you can't run it on anything after Catalina. The Win32 version works fine on Windows 10.