Cannot open iPhoto library

I am on OS 10.6.8 and iPhoto 11.

I had to do a re-install of the OS (and the apple store) due to a failed software update and presumed my timemachine backup would retore everything else thereafter.

To cut a long story short, I was left with having to drag my files onto the new Mac and did so with the iTunes stuff ok. However, on iPhoto when I click on the library it gives me the following message which may be misleading

"You can't open your current photo library using this version of iPhoto"

It gives me the option to quite although the subtext states:

"you have made changes to your photo library using a newer version of iPhoto. Do you want to quit and use the latest version of iPhoto or do you want to create a new photo library"

However, there is ONLY a quit option which leads me to believe that the issue here could be a later (newer) version of iPhoto is required?

Furthermore, when I go into "explore package" I can see all the files arranged by year in the "Masters" folder. However, an import into a new library does work but leaves the files in disarray - i lose all events and any organisation I had previously.

I have looked at https://discussions.apple.com/thread/3858125?start=0&tstart=0 which is where I got the idea of exploring the packaging and trying an import. But I would really like to ensure that I can keep the events or get the original db to work.

Any help would be appreciated.

Mikhail