Hi Gururaja Rao,

Welcome to the Penguin world.

MEPIS is a good distro. Its the top 5th distro as per distrowatch.com
Nice choice to get started with.

Regarding those issues:
1. I think it does not have the required sound drivers
Could you give us the output of "lspci" and "lsmod" commands
lspci lists the PCI devices so that we can see what sound card you have.
lsmod lists the modules(software) loaded by your kernel

2. Not sure why it happens. But could you post the output of "dmesg | tail" 
immediately after connecting your mouse and after the moment it stops working. 
It might help figure out what the problem is.

Looking forward for your reply.
 
--
Satish Vellanki 

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