Your camcorder shoots in a number of video and audio formats, so it's important first to determine which format you're shooting in. (You say it's shooting in 1080i/480i, but that's actually two very different formats!) If you plan to edit your video in Premiere Elements, it's important that you shoot only in either 1920x1080 at 60i or 1440x1080 at 60i. Do not shoot 1920x1080 in 24p or 60p or you're going to have problems! The 720x480 AVC will also likely give your trouble.
Once you've determined which format you're shooting in, it's important to ensure that the project settings you select when you set up your project match this video format! If you don't select, for instance, AVCHD settings for AVCHD footage, these components will not automatically activate for the program.
The biggest issue, however, is that your computer is way underpowered for working with hi-def video. In my books, I even recommend a dual-core computer for working with standard definition video. For working with AVCHD, I recommend an i7 or quad core processor. Trying to edit AVCHD on a Pentium will pretty much slow your system to a crawl if it works at all. Sorry.
Although you may be able to work with very short videos, if you've got plenty of free hard drive space (I'd recommend 50 gigabytes, at least), your project is set up to match your source video and you don't mind a lot of system lag.
Thank you Steve, I really appreciate that. For I just change the setting on the camera. I7 Processor will need to wait
What did you change your record setting to on your camera?