I say you get CS3, the latest version to Adobe Photoshop. I used Elements once but that was yeeeeeeeears ago, so I don't even remember the difference.
Elements is mainly for easy picture editing, such as red eye, not very good for making graphics or anything else really. The Photoshop CS series is for more complex things, and is for professinal's mainly. It's great for making graphics and digital art. I say get CS2 or CS3.
Go for CS2. I haven't used, but I know people that do, and it's been out for a while so there are most likely no bugs. I've used Elements, however and like Danger Mouse said, it's just for basic photo editing.
