lots of different ways to do this in PSE
the hard part is positioning the photos
but once you have your photos laid out you then merge them to one layer and use the circle cookie cutter
OR
another way
1. Draw Custom Shape (must be solid shape), creating new layer.
To maintain shape's aspect ratio, hold down Shift while drawing.
2. Move shape layer below your merged picture layer.
(If picture layer is the Background layer, must first rename it).
3. Select picture layer and group it with shape layer.
4. Use Move tool to position shape over desired location (either layer
can be active for this).
5. Link the 2 layers.
6. Ctrl-click shape layer to select it for copying & pasting.
(note: to copy, must use Edit->Copy Merged or Shift-Ctrl-C)
OR ctrl G also works
in CS/PS I would use a mask because then you can reposition
OR LOL
check out the tutorials:
Circle Layout
Layered Templates