Can 18K Gold Be Reused for New Diamond Jewelry?

Question
I have a pair for white and yellow 18K gold earrings that hold dimonds.  I am wanting to create a new piece of jewelry to hold the diamonds.  I was under the impression that the gold could be melt dowm and reused to create a new setting to hold the diamonds such as a necklace or ring.  I was told by a jeweler that I could not reuse the original gold to hold the diamonds, but it could be created into a different piece.  Why can I not use the same gold ?  Is it something about gases or toxins?

Answer
Dana-
Gold CAN be melted down and used for casting a new piece of jewelry, however, after melting gold many times it changes the molecular structure and can lead to porosity (air bubbles) in the jewelry. In addition, there may be solder and impurities in the metal which will make it brittle and may lead to fractures.....there are a host of issues with heating and reheating the gold. If diamonds are to be set in the item and  it has been reheated, the gold holding the diamonds in place may break and the diamonds will be lost.
The old gold can assayed, the gold can be separated from the alloys and be reused as new fresh gold. This is a process which most jewelers do not have the facility to accommodate.  
You may scrap the gold you have and use the proceeds for NEW gold and a quality piece of jewelry. It may cost slightly more but the result, if done properly, will give you a piece of jewelry which will be free from impurities and last longer.
all the best
Les