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After installation, the package may need to be activated (and remember to activate AUCTeX too). In XEmacs, and in any prepackaged versions worth their salt, activation should be automatic upon installation. If this seems not the case, complain to your installation provider and read on. You might salvage this by adding the following activation line to your own .emacs file or to a site-wide initialization file:
(add-hook 'LaTeX-mode-hook #'LaTeX-preview-setup)
There might still be missing an autoload form in which case you
would have to add
(autoload 'LaTeX-preview-setup "preview")
And in case the directory to which the Elisp files have been installed is not known to Emacs, a line like
(add-to-list 'load-path "/whatever/directory")
needs to be added as well.