I haven't seen Elements 6, 7 or 8, so going back in the past how layer masks were done in Elements 4 and 5 was:
Put the image you want to apply to the background layer in its own layer.
Create a new blank layer below this layer.
Select the top layer and Ctl->click the blank layer below it, then create a Group (I believe the command is Layers/Group, but it's been a long time.
The blank layer will be indented under the upper layer with content.
Then, what is also different from Photoshop is that you have to use the Eraser tool on the blank layer to erase the white (turning the erased part transparent) to reveal the content.
If I remember correctly, having the blank layer grouped also allows you to put content above this group that will not be affected by the "mask" so that you can repeat this procedure for other content.
This method can be used by the OP. Another approach would be to select content from a separate image and paste it into a layer on top of the background image -- you can then do things like move and resize, transform, whatever to the selection.