Trying to install knoppix (live cd) on a compaq laptop.

If I try just a standard install, it says:
Enabling DMA acceleration for: hda [ST94019A]
Enabling DMA acceleration for: hdc [HL-DT-STCD-RW/DVD DRIVE GCC-4244N]
Looking for CD in: /dev/hdc

At this point, it stops responding / sits forever.

When I boot in failsafe, it ends up getting to the GUI.
During the boot process, it finds the laptop's touchpad:
Mouse is: SynPS/2 Touchpad Synaptics Touchpad at /dev/input/mice.
However, once into the GUI, it doesn't respond to either motion or button presses.

Inserting a USB mouse (before/during/after boot) never responds.
Infact, the usb mouse is 'on' (laser active) until it starts to boot, then shuts off.

Any suggestions?