Premiere Elements 12 on what computer operating system? Have you updated 12 to 12.1 yet using an opened project's Help Menu/Updates. Please consider doing that.
To your immediate question
1. What is the exact wording of the error message during the Encoding Media phase of the burn to DVD....and are you doing burn to DVD-VIDEO standard or widescreen on DVD disc or AVCHD format on DVD disc?
2. If you cannot do the burn to disc, can you do the burn to folder? In either case, what does the burn dialog Quality area show for Space Required and Bitrate immediately before you hit the Burn button in the burn dialog? That is with a check mark next to "Fit Content To Available Space".
3. What is your project preset? What are the properties of your source media? What is the duration of your Timeline? Does this project have menus? If menus, is there a successful Encoding Menus phase before the Encoding Media phase that fails?
a. For menus...make sure the Timeline markers are at least 5 frames apart from one another and that the buttons are not too close together in the Movie Menu customization area of the project.
4. The typical sequence in the burn to includes
a. Encoding Menus
b. Encoding Media
c. Compiling Media
d. Burning to disc
Are you saying that you do not get beyond the Encoding Media phase? If so, that makes looking at the properties of the Timeline files and your burn to settings important.
Please review, consider, and supply more details. Any questions or need clarification on the above, please do not hesitate to ask.