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How fast is your processor, how much RAM do you have and what operating system are you using?
Because Premiere Elements edits native rather than intermediary video, it can take a lot of power to use it with AVCHD. Usually at least a quad core processor and a fully optimized operating system.
Picture Motion Browser is a simple player rather than a video editor. Did you select the correct project preset for your video project at the start up splash screen... ie the appropriate AVCHD project preset?
Also to edit AVCHD you need a powerful processor, I would recommend a quad core or as a minimum a very fast dual core. If your machine is not up to spec then you will need to hit Enter on your keyboard to render the clip, it should then play back smoothly.
I hope you are conforming to the minimum system requirements as on by Premiere Elements 7 box. However try to keep you RAM 3-4GB for better results. Also when you import an AVCHD file, it is a better idea to let the conforming take place, let the app stabilize and then start editing it. Also i would recommend you to be patient with High Def. editing as its a very heavy and memory consuming process.