iMac 20" Several Problems - Unusable Basically

I purchased an iMac April 2008 20" MB324B/A model from eBay, which came with several problem (it was marked as 'Parts or Not Working'). But it appears to present several issues that I have found:

1) When booting (on a new hard drive with a brand new clean install of OS X Mavericks) the iMac shows the Apple boot screen loading but once it disappears the logon screen does not show but the Apple logo reappears and after about 10 minutes the spinning beach ball stays for about 20 minutes before showing the logon screen. Then logging in takes several minutes and the iMac is basically so slow it is unusable.

2) After installation of OS, the first setup screen on the iMac takes about an hour to progress through as clicking the proceed buttons takes several minutes each time for it to progress the the next page.

3) The machine boots into safe mode perfectly fine and runs at normal speed, but several blue lines can be seen in the background (not show during boot up) and when loading apps such as Safari the graphics seem VERY glitchy (components of app loading in chunks and takes about a minute to load each part such as the tabs area). The app runs badly and is hard to use to browse with.

4) When selecting a disk with MBR booting such as a Windows 7 DVD the iMac takes a few seconds to place itself into the emulated BIOS but does now load the disc, instead just a black screen with no backlighting, but the computer stays on.

I have no idea what the problem could be, please could someone shed light on a possible reason for the issues and maybe a possible fix? Thanks.