Trouble with homebuilt pc

I have just built a new machine
Abit NI8 SLI motherboard
Pentium D945 CPU
512 MB Mushkin DDR2 667MHZ (single Stick)
PNY Nvidia 6600 GT video card
Seagate 300 GB SATA Drive
Cdrom and Floppy.

Problem is I cannot get the OS (XP) to install.
IT either locks up or Blue screens halfway through.
One strange thing I noticed is that when it start booting from the cd, random block of color happen on the left side of the screen, usually down near the first or second letter of the text showing the progress of the setup (lower left of screen)
I haven’t built a machine since Pentium 233 MMX days and I don’t know what to do short of removing all the non essential pieces and only have cpu, memory and cdrom and hard disk.