Q: How to reinstall OS? When...

Follow this instruction How to reinstall OS X - Apple Support

What OS is supposed to  be on the USB? Booting off the DVD is probably a better option.

Do a backup,  preferably 2 separate ones on 2 drives. Boot off the DVD and run Disk Utility Verify/Repair Disk and Repair Permissions until you get no errors. Then re-install the OS.

Normally, the OS shouldn't matter, but how the bootable DVD was created does. Did you use Terminal commands or a program like DiskMaker?