PS: is to print through Ghostscript.

Even though MorphOS comes with the gs-handler and the PS DOSDriver, it does not include Ghostscript itself.
So, by default, MorphOS is not be able to print through the PS: device. And never was, AFAIR.

Would it be possible you have installed Ghostscript in the past and forgot about it? And it is not working anymore for some reason (f.e. MorphOS 3.2 is now installed on a different partition or something else broke Ghostscript).

I suggest you try to re-install Ghostscript. You can use Grunch to do it very easily.
Then printing through PS: should work again.