Is the 2.8 P4 has Hyper Threading so it should be showing 2 CPU's instead of the one that you used to see with the older CPU which didn't have HTT.
The BIOS sounds about right but to get maximum performance out of the CPU you should be running 2 Sticks of RAM in the proper slots as well, your M'Board book will tell you what is supposed to go where.
As for the BSoD that all depends and should be something to do with the OS as it is seeing a HTT CPU now instead of the older unit that was there previously. Since you can get into Windows it must be working to a certain extent although I'm betting that the proper CPU drivers have not been installed so you are not getting the best performance possible.
The copy of Windows that you have may be responsible for the inability to reload the computer as if it is a "Recovery Disk" as apposed to either an OEM or Retail copy of Windows it most likely can not support the HTT CPU as these copies are not the full version of Windows but only have the drivers that the original system needed and nothing more. They also have any other Software on them as well and this is why they install the whole lot when you run them so you not only get Windows installed but also any Software that came with the system and all of the drivers for any hardware that isn't included in Windows.
The proper place to ask questions like this is in the Q & A section where you will get a faster response and more help most likely from someone within your own time zone. As TR has subscribers all around the world there can be quite a time delay in getting an answer. You should also have listed the version of Windows that you are using as well as the hardware.
I hope that is of some assistance to you maybe a Windows Update will fix the CPU driver problem but if it doesn't and you only have the Recovery Disc/s you'll be stuck with the problem until you can find a OEM or Retail copy of Windows and load from that.
Col