EDIT: This is wrong. Read EDIT below.
I figured it out. If you are running the application in the IDE, you are not allowed to change instance names. It locks that field out. I checked my publish settings and I did not have "permit debugging" enabled.
Seems weird to me. I could understand if it was "permit debugging" set to true. Anyways, hope this helps someone. Didn't even realize I had my swf opened until I reopened Flash and my last document that I had open was the game swf.EDIT
: This was actually happening because of a bug in Flash CS5. Here's an Adobe post about it.
I solved this by doing the following:
1) isolate offending assets into a new file (just in case the cs5 to cs4 wouldn't be kind to the whole level)
2) save the isolated assets file as CS4
3) save the isolated assets file as CS5
4) close this file, reopen it and you should have access to the instance names again