1 - FLV is an output format, designed for streaming video on a web site... it is not an input format to edit
2 - Bug Report and Feature Request https://www.adobe.com/cfusion/mmform/index.cfm?name=wishform
John is right. You can't edit FLV files in Premiere Elements.
Once you get the flv, you can convert it to AVI with an excellent program at http://www.flv2all.com then edit it with PE and make a somewhat blurry DVD or whatever.
If you use Firefox, you can also retrieve any file from any "Tube" sites without a downloader using the following procedure. This also does not download it twice thus saving web bandwith.
Start playing the movie on Youtube but pause it before it finishes.
Once the whole movie has loaded (red line fully across the screen) don't close it or your browser. Switch off your computer at the wall power switch (not the button on the front)
When you restart your computer, find the file with Windows Explorer in the following folder
C:\Documents and Settings\XXXXX\Local Settings\Temp (Where XXXXX is your Windows user log in name)
It will be the file with the most recent date.
It will have a name something like Fla56A.tmp
Rename it to a FLV file using whatever suits the video such as MyFlowers.flv
You can play the .tmp file directly with GOM player to check you have the right one
Convert it to AVI as I said before then edit it
You can download about 10 at a time as long as you open each one in a seperate new window or tab and not close them before you switch off the computer
It doesn't hurt the computer as long as you don't have any other programs except Firefox running at the time.I have done it hundreds of times.I've used bits of scenes and sound from other movies in my own movies.
The tmp file is there while the browser window is still open but you cant access it as permissions are locked.
Flash players in browsers erase all these tmp files when you close the window. Removing the external power defeats this erasure step.