Ok, here goes:
1. Any USB keyboard and mouse should work, but an Apple keyboard will have everything like the apple command keys.
2. Could be a number of things, either you don't have any system software, or the hard drive is dead. If you have the original CDs, put the restore one in the drive and hold down the key it says on the CD. If the HD is dead, you should be able to get a compatible one for not too much either on eBay or somewhere like newegg.com - just make sure it's IDE/ATA, and not SATA.
David