This problem can be a tough one if you don't have the budget to troubleshoot by trying different parts. Sometimes its easier to find out what isn't causing the problem by first simplifying things and then illiminating anything that isn't the cause and eventualy the culprit is exposed.
Something that's important is the fact that the system once worked. So it would seem more than likely something has or is failing.
The first place to start is the CDROM drive itself. Since you've had problems with installing anything I'd supect this. Plus a CDROM having problems may have had something to do with the slowness of the system and they're not that expensive to replace. If you have more than one connected disconnect the one your using and try the other. Remember to change the drive's jumper if needed.
As mentioned use the utility that came with your hard drive to totally erase it.
If you have 2 CDROMs disconnect the second one.
Start from scratch disconnect everything remove the motherboard inspect it closely for damage, clean it and reinstall. Pull out the user manual and check that all the settings are correct. Use the auto-detect features for the CPU and clocking. Again keep it simple. Don't put in any of the extra cards yet and in the system BIOS disable things like USB, sound etc. By doing this everything on the motherboard has been reseated.
All the settings have been checked and you don't have to try to remember what you have or haven't done yet.
Once you get the system back together with just one hard drive, CD, memory stick, and the BIOS settings to a minimal try the installation.
