I'm having a hard time booting from external drive to rewrite everything on new internal drive

I got this Powerbook used w/o any startup or software disks. It has some valuable software on it. It is over 7 years old and I want to put the system and all software and other files on a new internal hard drive. I bought two Western Digital drives to accomplish this but have been unable so far. I have used SuperDuper and Carbon Copy Cloner to successfully write everything onto the external drive after partitioning it Apple Partition Map. Neither Other World Computing (where I got the drives) or Western Digital have been of any use at all with advice. When I have the new clean drive in the Mac and the external connected by firewire and turn the Mac on while holding down the Option key all I get is a blank screen with a circular arrow and a right-pointing arrow and a mouse pointer. Clicking on either does nothing. If it is not possible to do it this way then can you suggest an alternate route?

My system: Powerbook G4 OSX 10.5.8 1.5GHz PowerPC.

New internal hard drive: WD 160GB Scorpio Blue.

External drive: same but the connector is for use only in an enclosure.

Wiring available: firewire or USB