Problems with start-up, shutdown, restore... Should I reinstall?

I would like to try to solve a few annoying problems with my OS. For a long
time, my computer would appear to shut down properly, but when restarted, it
would say "improper shutdown detected" and would run scandisk. Recently,
however, my computer has begun restarting itself when I try to shut it down,
making it necessary to turn it off with the power button. Another problem is
that the system restore function does not function. Whenever I try to create
a restore point, I get the message that the computer was unable to create a
restore point. I have also noticed that after downloading and installing
security updates, I get error messages upon rebooting something like "unable
to upgrade file %1 from %2."

When I run Norton WinDoctor (2001 version), it reports two missing program
files. One missing file is reportedly "mscoree.dll" which is used by
"C:\Program Files\Common Files\InstallShield\Professional\Run
Time\0701\Intel32\DotNetInstaller.exe" The other missing file is reportedly
"mhputilu.dll" which is used by the Microsoft Picture It! application. Could
my Win-ME problems be related to these two missing files?

I suspect that upgrading to Win-XP would probably be the best solution, but
I am planning to give my current computer away and purchase a new one with
XP. Therefore, I would like to try to get my current OS operating properly.
Would reinstalling Win-ME be a good idea? My Dell computer came with a CD
labeled "OPERATING SYSTEM Reinstallation CD WMe." Is there anything I should
do first (other than back-up data) or know about using this CD?

Regards,

Mike