Unfortunately, you can't use FLV files as source video in Premiere Elements. Sorry.
In fact, I don't know of any program that can use FLV files as source video -- or convert it for that matter. Even Adobe's Flash!
It's pretty much a delivery only format.
With the Moyea Flash Importer plug-in for PrPro, up to CS3, that program can Import and edit FLV's.
With about the second, or third update for PrPro CS4, full FLV (depends on the exact CODEC used in the FLV - no Sorenson Spark) Import and editing is possible.
I have the Moyea Flash Importer plug-in, and it has worked very well.
Also, there is a utility (cannot recall if it was freeware, or shareware) called FLV to AVI, that has worked pretty well for me, though not nearly so well, as with the Moyea product.
Now, there can be things to consider:
- There is no direct plug-in for PrE, and the Premiere plug-in only lists PrPro.
- Most FLV's are tiny in their Frame Sizes, so that is a major consideration.
- Often, the FPS of FLV's will be lower, so again, another issue.