It's supposed to be dark.
The "orange ball" will stay in the center of the screen because the game uses a central cursor. It isn't edge-panning. The cursor always stays in the center of the screen. Ordinarily you see the screen change as you pan around. But since every direction is dark and black in the closet, it may appear that the screen is frozen. When the game first came out, a lot of people thought their screens were frozen.
I checked Witchen's walkthrough at http://www.gameboomers.com/wtcheats/pcRr/road_to_india.html
and she says
After a cutscene in which Fred is seen beating on the door of his temporary cell; a dark, hot, little room. You need to find some light. Move your cursor around until you get a hand cursor. Click on it. Then click on your inventory to see that you have added a SINGLE MATCH and a BOX OF MATCHES to the resident rat and the screwdriver in your inventory. Light the match by striking it on the match box. Exit your inventory quickly and find a PIECE OF CLOTH on a shelf. Light another match, exit your inventory and find a small BOTTLE OF GAS. In inventory, combine the cloth with the small bottle of gas. Light the cloth with a match. Now you have a small gas lantern. Handy!
It's tricky to pan around a screen when you can't see where you're aimed. You have to be very methodical and patient. But I don't think you have a tech problem.