Elastic/Inelastic collisions are always defined in terms of KE, it being conserved in elastic and not in inelastic. But what happens to PE? In horizontal applications there's usually no PE involved, but consider a ball dropped onto a surface that experiences an inelastic collision. The ball won't reach the same height, so would one say that PE was not conserved? I've also had it explained to me that the PE immediately before the collision is the same as it is immediately after the collision, so PE is conserved.