a CMYK image?
If so it's a new one to me but I see from http://www.dansdata.com/graphics.htm that .cmyk file format is supported by JFIF, or commonly called JPEG.
Can you convert that to a .jpg file then use that in Photoshop Elements?
That said, looking at http://www.corel.com/corel/product/index.jsp?pid=prod3430198&cid=catalog20038&segid=653&storeKey=us&languageCode=en I see that PSE has a plugin available for Corel KnockOut 2, so I assume no conversion is necessary.
This is all guessing from me, I have never heard of this software