I've just found this on the Adobe site:
"Important note: Download the files and install and use Photoshop Elements with an account that has Administrative privileges. The updater process may fail if you are running the application under the Standard User Mode and change the default extraction location. This is due to standard users' access privilege rights set by Windows Vista.
1. Double-click the Adobe Photoshop Elements 5.0.2 Updater application. If the updater reports that it cannot find the application to update, uninstall Photoshop Elements 5.0, reinstall the application (using the default folder name "Adobe Photoshop Elements 5.0"), and then run the updater. "
Haven't tried this yet so will see how it goes...