Mary, here the tut I wrote:
http://www.godigitalscrapbooking.com...background.pdf
It's for Paint Shop Pro, but it should translate fairly easily to Elements....it talks about 3 different ways to do it - Feathering, Blending (Opacity), and Masks (I don't know about Masks in Elements), but the first two should work almost the same way in PSE.
If you need help, let me know, I've got PSE 4.0 on my box, too (I do walk on the wild side occasionally and venture in the world of Adobe
)