BSOD vs unresponsive input devices...catch 22

Hi all.
I'm not very good with computers but I did manage to build my own PCs for a good few years. But I've come across this problem that has me and my friends stumped.

Basically booting up, the mouse and keyboard (hence, input devices) power up and can be used in the BIOS/POST screen (well the keyboard anyway). But when the Windows splash screen appears, they become unresponsive and aren't detected when I pull them out/put them in again. They are USB powered but I have tried this with non-faulty PS/2 ones and I get the same problem with that.
Without any input devices working, I can't use the PC to do stuff with.

The second of my woes is that when I try to install Windows I get a BsoD
STOP 0x07E
pci.sys
I get this when the CD is loaded in and I am just about to select my drive for installation.

This problem has come on with a completely brand new system. i.e all parts are fresh out of the box. To compound the mystery, I bought other new parts of which are compatible with eachother and I still get the same error.
 
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