You don't have to flatten the image if you use CS4 (I believe it works in CS3 too). Just select all your layers in your layers palette, right click that selection in your layers palette and select "Convert To Smart Object". You can now sharpen this object without destroying any image data.
Personally I prefer a different method, because I don't like hiding my stuff in a smart object if I don't really have to.
What I always do is make a new empty layer at the top of my layers palette and press Ctrl+Shift+Alt+E (control+option+shift+E on the Mac). It's called "Merge visible", meaning that it will merge all visible layers onto that layer. I then sharpen that layer. Sharpening should always be the last step, so in this case it's a method that doesn't break proper workflow. It also avoids that you make a mistake by flattening all layers and saving by accident. ;)


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