My replacement 2011 iMac had BT difficulties so I got a BT dongle for it. HOWEVER... dongles aren’t recognised on initial reboot so I have to use a wired mouse, go into a non-password protected user account, click System Preferences/Bluetooth, then switch on and pair my BT mouse and keyboard. I can do all that with just a mouse and no keyboard.
Your issue may be different, but you should start with a wired mouse then try to pair your BT kb / mouse as per above.
By the way, a Magic Mouse DOES have an LED - it's on the base just above the on/off switch. Steady green means it's on, also when it's paired. Flashing green is when it's trying to pair with the Mac.