Hey. I started making my own theme and my theme's single.php file doesn't load when I turn on pretty permalinks. It just loads the index.php instead.
What is weird is that when I change themes to a default WordPress theme, then single.php loads correctly for single posts. Even after replacing my theme's single.php file with single.php from a default WordPress theme, when my theme is activated, then single.php doesn't seem to run.
You can have a look here http://www.indiegamerzone.com/the-battle/
Let me know if you need any more info.