ActionScript 2.0 :: MovieClip - Control Resize With Mouse Or Single Click / Drag

I'm pretty new to Flash and seem to be struggling with variable scope, events and where to put code within movieclips/main area etc. What I'm trying to do is produce a Flash movie that will allow the user to click on a tool from a selection, i.e. a circle, then click on another part of the screen to place the centre of the circle, with a second click to set the radius of the circle (an alternative would be a single click and drag to place the circle and drag it out to the desired radius.) Once the mouse if clicked a 2nd time, or the drag operation is completed, the circle will stay at the selected radius.

The code I'm using so far to test out the idea is below:
_root.onEnterFrame=function(){
_root["item1"].onMouseMove=function(){
d = Math.sqrt(Math.abs(_xmouse-this._x)*Math.abs(_xmouse-this._x)+Math.abs(_ymouse-this._y)*Math.abs(_ymouse-this._y));
if(d<370){
this._width = d*2;
this._height = d*2;
}else{
this._width = 87;
this._height = 87;
}}}

This uses a simple circle movieclip, and the above code is placed in Frame 1 of the background as opposed to the movieclip itself. It resizes the circle movieclip ok, but I want to be able to control the resize with the mouse or with a single click/drag.