I will cover how to install Photoshop Actions in a future tutorial. For now, you can install your downloaded action into this folder to get it to work: C:\ProgramData\Adobe\Photoshop Elements\7.0\Photo Creations\photo effects . MAKE SURE that PSE or CS is closed before you install the new action. Personally I just make a shortcut of this folder and keep it on the desktop so that I can load new actions into it quickly. If the new action shows up without a thumbnail, don't worry. You can still hover over it to get it's name.
If you're clicking on an action and it isn't working, be sure that the photo you want to add the lomo effect to is the Background layer. If it isn't, then name it Background. Make sure the background layer is selected before applying the action.
Photoshop/PSE may look like it's wigging out as the action is taking place. Don't worry. It's just because Photoshop is working fast doing everything it's supposed to. If something comes up asking you to 'continue' or click 'ok' then do so until the action has completed.
For a more step by step tutorial on how to make photos look Lomo without an Action, you can check out the awesome tutorial HERE.
Happy Photoshopping!