Power CMS not working despite having localhost installed

I've installed Design Extender, set up a localhost on my PC which works fine in DW liveview, and I set up the local testing server in DW. All works well. But when I try now to add PowerCMs to a selected content in DW design mode, nothing happens.

Before I had the localhost installed, when I selected content and pressed on "Add content to PowerCms", the PowerCms display appeared prompting me to "Create PowerCms Content". This way I found out that I needed to set up a localhost. Which I did (Xampp).
But as I say, now the PowerCms display doesn't appear any more, nor is any cms inserted in the selected content.

Also, in case I shall manage to get it working, what should I fill in as "Connection"? Your tutorial video doesn't explain this issue. (In the video it says "PowerCms Connection" - should I put that in, too?). I'm a complete newbie with php - this is a steep learning curve indeed. Please help."

Also, when I start Dreamweaver now, I get the following message:
Unable to find WA_SiteTools.html on the Configuration/Floaters directory. The floater will not be shown.

Please help urgently as I'm trying to set this up for a client.