Screen issue -- Dell Inspiron 5000e

I picked up a Dell Inspiron 5000e laptop second-hand (Windows ME installed) and I'm trying to get it to work. There are two issues: screen and touchpad. I'm just focusing on the screen for now since I can plug in an external mouse. Here are the symptoms (I think they may all be related):

1. When I turn the laptop on, the LCD screen will not light up. If I press Fn + F8 to toggle CRT/LCD, the LCD screen will flicker briefly. If I hold a flashlight to the screen, I can still see a very dim image but the backlight refuses to stay on. However, if I plug in an external VGA monitor, then press Fn+F8 several times, the LCD screen will stay on. I can even unplug the ext. monitor and the LCD screen backlight will continue to stay on. I just need to plug in the ext. monitor at some point after power-up to get the backlight to stay on. Or, if I plug in the ext. monitor before power-up, the LCD screen backlight will come on and stay on from the start.
   
   
2. I have to try 3 times before I am successful to boot into Windows ME. The first time, I get Windows ME loading image for about 15 seconds then then screen goes dark (not off -- just black), then the hard drive stops accessing and nothing happens. I restart either with Ctrl+Alt+Del or by holding down power button, then I am given the option to boot into safe mode. I select "Normal" boot (not Safe Mode). The same thing happens a second time. The third time, I successfully boot into Windows. (Other times I booted into Safe Mode and tried to do System Restore; that was unsuccessful. There are no system restore dates that correspond to a time before I acquired the laptop.) This "3-step booting" happens every time, whether I boot from shut down or restart.
   
   
3. As soon as Windows loads I get this message: "The driver file that displays items correctly on your screen isn't working. To fix this, you might need to install a new display driver..." (I have tried reinstalling ATI video drivers from the original Dell Drivers & Utilities CD-ROM; that doesn't solve the problem.) I click OK, then I am prompted to adjust display resolution. It is set to a hideous minimum 640x480 with 16-bit color. If I try to adjust it to anything higher, such as 800x600 or 1024x768 with High Color (16-bit), I am asked to restart the computer. (If I restart, same thing described as above in bullet point #2 happens again. When I boot into Windows, resolution is still stuck at 640x480.) If I don't restart, I can continue to log into Windows okay.

     There are no red flags, exclamation marks, or yellow triangles in Device Manager. Installed video drivers are ATI Rage Mobility-128 AGP 2X (English). I'd appreciate anyone's advice or help; thanks!