Mouse and screen problem?

I am having some problems with my HP XE749 computer that runs on windows me

the mouse only works in safe mode and the scree is grey and black with very poor resolution. I can only use the key board, but when i am scrolling down it doesn't highlight.

some one suggested that I put in the reinstall disk (windows me cd?), select repair, then press f8 and everything shoul be there.

when i put in the cd i get 3 options

start windows set up from cd-rom

start computer with cd-rom support

start computer without cd-rom support

which should i choose AND will therir be a repair option there?

Mouse and screen problem?adware

call the windows help line they will take you through all of the steps that will fix this problem.