There's a bit here on Capture Video / Capture Settings in which it says that DV capture is one of the settings. DV is the one you want -- it will have an AVI extension.
http://help.adobe.com/en_US/PremiereElements/7.0/WS2AF26FB5-4C63-4c46-9DB3-7249558F6528.html#WS6974F2DD-FBE5-4f66-937D-F1B47A3E9476