Have you created a VCD using PSE3 and found that the quality is crappy? The problem with VCD format is its resolution and video bit rate. Images are down-sampled to 352x240 and constant video bit rate is set to 2000 kbps during the WMV encoding process. When the VCD is played on a television, the 352x240 images are displayed in full-screen mode and you lose the quality of the image.
The Elements 3.0 slideshow, which is based on WMV and VCD spec, is very strict about how the movie file is encoded for VCD purposes. The reason for low video bit rate is that VCD was originally intended to display 1 hour of video on a 650MB CD. The higher the resolution size and video bit rate, the larger the individual movie file on VCD. If you feel adventurous, you can increase the bit rate by editing the existing VCD NTSC Output.prx file, but that gets pretty technical and you don't want to dig yourself into a hole you can't get yourself out of.
Album 2.0 is a little different in as it is merely wrapping creations to PDF. Images are not down-sampled to 352x240 and it is not encoded in VCD movie file. It's merely a PDF creation with a movie file on a CD.