Hi Deborah,
do you mean that iPhoto 5 did not upgrade the version 4 library?
You shouldn't have to import the iPhoto 4 library, it should have been upgraded when iPhoto 5 opened it for the first time.
If you did that and the library didn't open then you can create a new library and import the version 4 library.
I think you are getting that error message because you are trying to import the images that are already in the library folder that iPhoto is using.
Here is how to create a new library.
Close iPhoto
Rename your messed up iPhoto Library to "iPhoto Library_old"
Drag this library to your desktop
Hold down the Option key and launch iPhoto
This is the window you will get
Create a new library or choose a library to open
Choose to create a new library
Once this new empty library is open it is time to import the images from your old library
Go to File>add to library
Navigate to the old library on your desktop and choose it.
iPhoto will start importing the images from your old library
This is what to expect:
Your images will be imported in nice dated rolls. (make sure your view is set to sort by rolls to see it) There are a couple of caveats to this. You will get rolls named "Originals" These rolls will contain your video clips and your original images that you had edited. If you had RAW files they would be in those rolls too (I don't do RAW, so I don't know for sure) Delete what you don't want from those rolls. You will also get the jpeg pointer files to your video clips imported. They will just be jpegs and will not point to the video clips anymore as iPhoto made new ones when the clips were imported again. You can delete those. they should be in a roll right next to the newly imported video clips so they are not hard to find. The thumbnail files don't get imported as iPhoto makes new ones when the images are imported.
Once all you images have been imported, check through the library and make sure everything looks ok.
You can now start making your Albums, and do your keywords or any other organizational steps.
You can also delete the old library on the desktop.
It is also a good time to backup this new library to CD/DVD by burning the iPhoto LIbrary folder in the Finder, or copying the iPhoto Library folder to an external drive formatted for Macs, or copying the iPhoto LIbrary folder to an iPod.
Good luck!
Lori 
