PBase

I started using Picasa2 recently, and found that starring pictures is very useful (much better than duplicating folders and deleting unwanted pictures).
Unfortunately there's only one star. Do you know of any other photo organizing software that has multi-star rating system, akin to Windows Media Player?

Adobe Elements 3 has an organizer that allows 1-5 stars

It is based on Photoshop album which also has that feature. So you can try the free version and see if it will do what you want.