This is not clear:
I have a wordpress blog, and bought a domain under wordpress registrar. I hosted my wordpress blog and activated it in bluehost.
What do you mean more specifically?
Are you saying that you have an existing blog that can be accessed in a browser with an address such as (example)
http://www.myfunkyfailedblog.com ?
And that even right now you can go to such an address in your browser and see your Wordpress pages as they are hosted from the server at BlueHost?
When you went to Appearances the Custom theme has to be uploaded as a .ZIP file., not as a folder with a bunch of other Classipress files inside it.
Maybe you should try going back into Bluehost and renaming "classipress" to "badclassipress" or some such name.
Then try it again in Themes in the Online Wordpress blog, uploading the .ZIP file. I assume that you do not have a bunch of plugins already installed. If you do, deactivate ALL of your plugins first, before trying to re-upload the Classipress ZIP file.
Install a theme in .zip formatIf you have a theme in a .zip format, you may install it by uploading it here.