Aspect Ratio problem with Premiere Elements 10

I had old super 8 cine film transferred to video for me in December 2011 and put
it onto a Blu Ray disc as AVCHD files.
The disc is copied onto my computer and displays in the correct 4;3 aspect
ratio on the Desktop and plays correctly in VLC media viewer.
I have Adobe Premier Elements 10, but the video is “squeezed” narrow, e.g.
a circle displays as an oval in Monitor, Timeline and Sceneline views.
When I save the work to a disc it is also “squeezed”.
Pictures/footage from my Sony AVCHD video camera display correctly on the
Desktop and I have not had the above problem when editing it in Premier
Elements 10. I have also edited 4:3 photos and 16:9 video aspect ratios together into
without problems
I would be grateful (and relieved) if you can tell me how to fix this
please.

Thanks to people who showed an interest and replied.
Thanks especially to Kevin at digitacopycat who pointed me towards a workable solution within a couple of hours of posting the problem.
ASPECT RATIO
  1.  Open Premier Elements 10
  2.  Select and load the folder you wish to work on
  3.  In the Tasks Panel, click and open Project
  4.  Right click-on your folder
  5.  From the drop down menu select Interpret Footage
  6.  Choose Pixel Aspect Ratio and click-in the circle next to Conform to.
  7.  Click-on the down arrow to open the drop down menu
  8.  Select and click-on HD Anamorphic 1080 (1.333)
  9.  Click ok
10.  All clips in Monitor Panel, Sceneline and Timeline change to the correct Aspect Ratio
11.  Render the clips to maintain their correct Aspect Ratio

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