There should be no problem getting PPENG working enough to edit in Windows 7/8 (at least it's working just fine on my 64-bit W7 system), but anything involving file transfer requires an actual Windows XP machine, be it a virtual machine (like the free one that came with Windows 7 Pro) or an old true XP system.

Simple compatibility mode isn't going to be good enough because there are custom USB drivers involved.

Be sure you're installing with administrative privileges, and that you reboot after. Also, I just checked and I don't have any compatibility settings selected for PENG or PPENG.