I decided to download the language specs for PHP, and install them in my XCode 1.5 and keep tweaking them until they worked and guess what --- they work now!
If you want the highlighting for PHP back in your XCode, try this out. I am able to code php now with highlighting and no problems.
[robg adds: I downloaded and installed the spec and it seemed to work as described. I don't do much code writing at all, though, so it probably won't help me much!]
Mac OS X Hints
http://hints.macworld.com/article.php?story=20040830025055509