Traktor Studio 2.5.0 setu pwith CDJ400 and DJM700

HI, i am really not getting anywhere on the Native Instruments Forum and also youtube i dont know where else to go to so i have decided to try give some other external community s a go.
I am not understanding how to setup Traktor 2.5 to my DJ setup which is DJM700 and CDJ400s i have installed the ASIO drivers on windows XP.
I just dont understand how to setup the settings within TRAKTOR itself and its really annoying since NI has a video and its all flashy and it is supposed to be easy, such lies!
When i enter my Traktor it tells me to check my routing output and its bloody irritating i have tried a few things but i dont get it.
I get to play back tracks but i dont know what the correct setup is.
I also get sound drop outs.
I am not sure what to select for the Internal and External and the Audio setup itself (that tab) and the other tab which is routing (within there , there are 2 tabs External and Internal) I just cant understand why it is so bloody hard to do this.
Can anybody help me here?

p.s. I have On board sound that i use on my PC. i have a dinosaur computer also which is AMD Athlon XP 2800+ if this is of any use to know ? maybe speed an latency ?
Nevertheless i dont know how to set up the sound options as mentioned above.

I also use my DJ Equipment with my computer as a standard setup .... basically i connect my mixer master output to my Computers LINE-IN which obviously gets routed through my computers on board sound through speaker out.

Please note this as we may need to tweak this?
I do have a spare 7.1 24 bit Creative Labs Sound Card and also a Creative Labs X-Fi (no idea if where to get drivers for it) and a much older Sound Blaster Live card.

Thanks