What operating system are you using?
What is your screen resolution?
On windows systems for example, you can right click on the desktop, click on Personalize (or Properties) and choose a picture and the way it fits on the screen.
If say your screen resolution is 1920 x 1080, then in the photoshop elements editor you can use the Crop Tool to crop your picture to the screen resolution.
Example with 1920 x 1080
Enter the dimensions in the width and height boxes and then draw the crop tool out.
Then save the picture as a jpeg with a quality between 8 and 10.
Please allow me to clarify.
I want to retain the picture as is. No cropping, size remodifcation or resolution/aspect changes.
I do not want to artifically stretch the picture to fill the screen.
I want to use PSE or PS 2 to:
a) Create a colored background that complements the picture.
b) Inport the picture
c) Combine the results of a and b to form a new file.
Open the image and use the menu:
Image >> Resize >> Canvas Size
Ad 10 cm to the width or a couple of inches and uncheck the right pointing anchors. Select a color of your choice and click OK to apply to the left of your original size image.
File >> New >> Blank file
Choose a width and height and resolution 72 and choose a background color.
Click OK and then open your image.
Drag your image from the photo bin and drop it on top of the blank file. Select the move tool and drag the corner handles to scale and then move into an appropriate position.
Ah, my mistake for not reading your post closely enough.
It still helps to know your screen resolution as just using 16:9 ratio won't necessarily fill the whole desktop even with a colored border.
What version of photoshop elements do you have?
I guess you have photoshop cs2 as well?
Also, what operating system are you using?
Here's another way:
1. Open your picture and double click on the background layer in the layers panel to make the layer a regular layer
2. Go to Image>Resize>Canvas Size and enter your screen resolution in the width and height boxes with relative unchecked
3. Add a new color fill layer and move the color fill layer (Solid Color) below the picture by dragging on the color fill layer in the layers panel
4. Double click on the color fill icon in the layers panel to change the background color.
You can also use the eyedrooper to sample colors from your image while the color picker dialog is open.
5. Save your picture as a jpeg and set your desktop background using your saved picture.