If you are getting a CODEC error message, then something is not quite right. I'd start with downloading and installing the latest version of QT, which I believe is 7.6.6. That should install Apple's H.264 CODEC, which is what you want. There are two other very popular versions, one from Lead and one from MainConcept. Many PrPro users like the Lead, or the MainConcept, better than the Apple version.
I would also make sure to upgrade your video card's driver from the mfgr's. Web site.
Video from still cameras nearly always needs to be converted before it can be used in Premiere Elements, per the FAQs to the right of this forum.
Your camera shoots in MP4 format. The best tools for converting this to DV-AVIs are Super (which is free) and Quicktime Pro (a great value at $29 from Apple.com).
Thanks for your help. Your advice worked and I am thrilled that I will now be able to make movies.
Thanks for reporting back. Happy moviemaking, Barbara!