Version 10.87 isn't out as of this writing. Look at the left-bottom of the VP window. The release version just now is 10.86.
The diffuse effect is available in that release here. If not there, try a reinstall or more (no need to download). It may show up.
Show Mask is available in my installation as well, but it's likely not needed. If that box isn't shown, the mask itself won't be available in black and white.
Until you add the TRANSPARENCY effect you will see only a rectangle in Clip Preview if Show Mask is UNchecked and Image Mask bar is selected (blue).
Click the Transparency bar to see the shape in Clip preview or view it in Sequence Preview via the dual window display.

If crashes or purple windows persist be sure to file a bug. Click the chevron at the top-right of the VP window. Cannot replicate either of those issues here.
What are the PC specs - CPU/GPU/RAM/free space? Be sure to mention those when filing reports.