Can people find out who the previous owner was by the VIN?

The short answer is No.

In 1994 Congress enacted the Drivers Privacy Protection Act which makes it unlawful for states to disclose the personal information of individuals that it has in its database.

There are exceptions. They are called Permissible Uses. Those are:

•For use by any requester, if the requester demonstrates it has obtained the written consent of the individual to whom the information pertains.
•For use by an employer or its agent or insurer to obtain or verify information relating to a holder of a commercial drivers license that is required under the Commercial Motor Vehicle Safety Act of 1986 (49 U.S.C. App. 2710 et seq.)
•For use by any insurer or insurance support organization, or by a self-insured entity, or its agents, employees, or contractors, in connection with claims investigation activities, antifraud activities, rating or underwriting.
•For use by any government agency, including any court or law enforcement agency, in carrying out its functions, or any private person or entity acting on behalf of a Federal, State, or local agency in carrying out its functions.
•For use in connection with matters of motor vehicle or driver safety and theft; motor vehicle emissions; motor vehicle product alterations, recalls, or advisories; performance monitoring of motor vehicles, motor vehicle parts and dealers, motor vehicle market research activities, including survey research; and removal of non-owner records from the original owner records of motor vehicle manufacturers.
•For use in connection with any civil, criminal, administrative, or arbitral proceeding in any Federal, State, or local court or agency or before any self-regulatory body, including the service of process, investigation in anticipation of litigation, and the execution or enforcement of judgments and orders, or pursuant to an order of a Federal, State, or local court.
•For use in providing notice to the owners of towed or impounded vehicles.
•For use in connection with the operation of private toll transportation facilities.

The complete document can be found here: http://www.accessreports.com/statutes/DPPA1.htm