First, you say that you open a RAW file in the RAW(DNG) Editor. I am having trouble understanding that - the only DNG that I know about has no RAW editing capability - all it can do is convert RAW files to DNG files. So, my first question is, what exactly do you mean by the RAW(DNG) Editor. So far as I know, there is no such thing.
Perhaps you are confusing the Adobe Camera RAW plug-in with DNG - the two programs are quite different and have a very limited inter-relationship. DNG converts RAW files to DNG files and has the option of embedding the CRW or CR2 file in with the DNG file.
Camera RAW plug-ins have the ability to read DNG files - thank goodness! That's the basis for the workaround for those who have newer cameras but don't have PSCS2.
When in the Camera RAW plug-in in CS2 you can make saves to any other formats before leaving Camera RAW. However, in PSCS (version 8.0) you could not save while in Camera RAW (ver 2.4). You had to press OK and leave the Camera RAW processor in order to do a "save as". I suppose it may be like that in Elements 4, also, but I'm not familiar with any version of Elements.
The last thing that you say that confuses me is when you say that you have to open the RAW image in Elements 4 Edit window before it can be converted and saved as a JEPG or Tiff. The reason that sounds very strange to me, is that I don't believe any Photoshop program is capable of opening RAW files directly - they all have to use the Adobe Camera RAW plug-in - do they not?
At this point I'm also wondering about the possibility of confusion with a little used format available in PS called .raw. There is such a format, but it is not a Camera RAW format.
Perhaps you could try describing the problem again, because there are just too many things here that don't compute.
