I'm constantly marking a block of text and assuming that a search and replace will act only on that block (as it does in all the other editors I use). When it alters my whole document, I have to revert with Ctrl-Z and start over. Maybe there's a setting I'm missing?

I just lost several hours of work when a regex search and replace would have worked fine on the block I marked, but locked up PhpED when it tried to do it on the whole document.

I agree, this makes good sense. It will be helpful of the search scope will be "Selected text" if (and only if) I currently have text selected.