WordPress 3.5 issues with CKEditor 3.6.3

CKEditor does not work with WordPress 3.5.

In editing, the contents are all invisible. None of the tool icons are available and the word count does not work. If I right click within the contents and do a select all then I can see my contents, so everything is still there, just invisible.

I am currently using CKEditor 3.6.3

I tried to upload the newer versions of CKEditor on my WordPress 3.5, but I keep getting an error saying:

(Installing Plugin from uploaded file: ckeditor_4.0_full.zip

Unpacking the package…

Installing the plugin…

The package could not be installed. No valid plugins were found.

Plugin install failed.)

When I deactivate the CKEditor plugin the default WordPress editor works good.

Can anyone assist with this?? Please Advise.