- Export the frame as a still
- Clear (so the gap doesn't get removed) the frame from your timeline
- Edit the frame in PSE
- Import the edited frame to your project media
- Place it in the gap
Insanity is hereditary, you get it from your children
And in version 9 you can also use Share/Computer/Still Image.
Per my books, you'll get the best results for a photo is you go to the Advanced tab and select the options for saving your still as a 640x480 square pixel photo. (With hi-def video, save it at 1920x1080 square pixel photo.) You can then save this as a custom preset for future use.
When you open the photo in Photoshop Elements, go to Filters/Video and apply the DeInterlace filter. This will get rid of most of the photo's interlacing artifacts.
You mentioned "Frame," but is the problem in only 1 Frame, or several?
If it is in ONLY 1 Frame, Neale's method will work fine. If you have several Frames, that need to be edited, then you are talking about Rotoscoping, where each Frame in a segment of the Clip is edited individually.
Let us know if Neale's method does exactly what you want.