okay so on further investigation the "outline mode" might be a feature in older versions of photoshop, according to this site, it says version 3 & 4, I'm assuming photoshop 3 & 4.
Quote:
Moving images (Versions: 3 & 4 for Macintosh & Windows)
When you select and move an image, Photoshop displays the moving selection in two ways. The first way is to display the image as you move the
selection. The second method displays only an outline of the selection.
Both displays have their advantages, but to make optimal use of either, you should know how Photoshop decides which display to show. To display the
contents of an image as you move a selection, click the selection using the Move tool and wait a moment. Then, Photoshop displays the selection and its contents as you drag the selection to a new position. To display only the outline of a selection as you move it, click the selection and immediately
move it. Photoshop displays an outline of the selection.
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source of info
it seems like it says that photoshop will do this automatically for you, but I've tested it on my version and it doesn't do it for me.
best of luck!
-agentxi-