I think you gave /s a few features that it doesn't posses. /s changes what '.' will match, just like you said, but if you want the '^' and '$' anchors to match around an embedded newline, you'll need to toss in the /m switch as well...

Update: After re-reading the node I followed up to, I think we're both correct.... consider this a clarification of the node above it, rather than a correction. ;-)

-Blake