Capture screener, let me draw

Relating to my last problem, now that I have the program made as much as it needs to be for the time being I would like to have a way to click a command box, have the program take a screenshot of the current screen then let me draw on it. I've seen programs that do this before, they allow you to shoot at your desktop and other such things, but have no idea how to do it. The screenshot part I could probably handle on my own if need-be, but my only idea for drawing is to use a timer with API calls to see the status of the mouse and if the mouse is down draw a small circle at the mouse's X,Y coordinate. That would probably work fine, but in order to do it I'd have to have the timer running off very quickly and I think it would be a fairly inneficient memory hog for something I can do in paint much easier. So is there a simple way to do this, or should I just stick with prntscrn, paste, draw??

Perhaps you could take a look at this:
http://www.juicystudio.com/tutorial/...ingexample.asp