A customized template must be formatted in particular way, and you must have both a "sm" (scene menu) and "mm" (main menu) version in order for the program to recognize it.
Then, create your own folder for this template in C/PROGRAM FILES/ADOBE/PREMIERE ELEMENTS 7/DVD TEMPLATES/GENERAL. Again, you MUST create a separate folder inside one of these category folders and you must have both templates.
Then, just restart the program. If your formatting is correct (where did the custom template come from?), the program should display it in its Disc Menus.