As it says in the flyer that comes with the program, you do not capture video from a DVD. You rip it from disc.
Place the finalized DVD in your computer's DVD player and then use Premiere Elements' Get Media/From DVD Camcorder or DVD Drive to open the Video Importer. Locate the DVD drive and rip the files to your computer and into your project. (Of course you'll need to ensure your project is set up for Hard Disk Camcorder/720x480 before you begin or you'll have problems with your project later.)
I detail, step by step, how to do all this in my books, if you're interested.
You can also see the basics in parts 1 and 2 of my free 8 part Basic Training tutorials at Premiere Elements support site Muvipix.com.
thanks, i just that and it seems to work. i know this issues has already been discussed in this form but wanted to see if there are other alternatives. i noticed that you lose the subtitle time stamp using this method. is there a way to insert the time stamp of the date and time shot?
Unfortunately, no. This is how it's designed to work.