BTW is PE 2 significantly better than PE1?
Yes. For one thing, it runs natively in X. Check around at places like Amazon.com. If you register your copy of PE 1, you can find PE 2 for $29 or less, usually. Scanning in classic is enough of a pain to make it well worth the investment. Also you get several new or improved features in PE2.
If you want to use PE 1, you must have classic set up on your machine and you must install PE 1 into classic, not into X.