I've been seeing lots and lots of text circles but I never knew how to do it. I figure I'm not the only one! So, did a search for tuts, and here it is for PSE3 (I don't know how it will translate to other versions):
1. Open a new document
2. About half way down the page, type your text, sizing the font large enough that it stretches all the way across the page.
3. Simplify the layer.
4. Flip the text upside down.
5. Ctr-T to resize it- you want it to be about twice as tall as it was, but keep the same width.
6. Filter--Distort--Polar Coordinates-- check the bos for Rectangular to Polar--OK.
7. Rotate/ resize as desired.