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You're not going to be edit DVR files in Premiere Elements, Chuck.
You may possibly be able to do it in Windows MovieMaker. But, as far as I know, it's only officially supported by a few video editors, such as VideoWave.
That just is not right :-(
Thanks for the feedback
Client had a DVR full of his wife's cooking shows, recorded from the TV. We hooked up his DVR to my Analog to Digital (A -> D) capture board (Turtle Beach) and, using the TB software, captured to DV-AVI (muxed) files. I then edited these in P-Pro (PE should work exactly the same).
If you do not have an A -> D converter on your system, take a look at the Pyro FW box (listed in the FAQ with URL for purchase), or the lower-end Canopus capture devices. I believe that they are in the US$150 range, about the same as my TB card (with front-side BOB). Stay far away from any Dazzle product. You also want a FireWire connected box, not a USB one. The USB would possibly work with its included capture software, but many are limited in the file types they capture to. You want DV-AVI files, so check this out, before you buy. I have used uncompressed AVI's, but the result is the same, quality wise, and the files are monsterous! DV-AVI is the way to go. Files still not small, but you'll be going to DVD (MPEG-2), when you burn to disc.
All is not lost, but you'll need an additional link in the chain.