Chris,
As you are asking this question I assume you are new to Photoshop and the only choice for you is Photoshop Elements 5 as Photoshop 7 is no longer available. You can see the features of Elements 5 on the Adobe website.
The current version is CS3 which is version 10. You can upgrade from any legal copy of Photoshop from 7 upwards ie. the last three versions.
Ken
Hi Chris,
Elements 5 is probably easier to use but does not have some of the features that are in PS7.
However, PS7 is quite old now, and there are several features in Elements 5 that have been developed since PS7 was around.
I don’t think you can process RAW files in PS7, but Elements five uses a cut down version of the latest version 4 of Adobe Camera Raw that is also used in Photoshop CS3
Elements 5 can catalogue your images.
As Ken said, you can get a full list of Elements 5 feature online.
If you plan to upgrade to CS3 in the future, it will be more expensive from Elements 5 than from PS7. If you are thinking of going to CS3 at some point, then a used full version of PS7 on an original disk with a serial number would be the cheapest option.
Hope this helps.