In that case I would load AP firmware on radio 1, AP bridge mode, give it an IP in the subnet of the upstream router eth1 is connected to, set the SSID, channel and 802.11 protocol etc. Leave proprietary bridge unchecked for now.
You can keep the CPE firmware on radio 2 if you want, but I always load the AP firmware if it's going to be a ptp link only. Set it up as a client bridge, give it an IP in the same subnet as the AP and router, gateway is the upstream router address, same SSID as the AP, same 802.11 protocol. Leave WDS mode unchecked for now.
Now you can check the link for signal strength and check for connectivity through the link. If the router upstream of radio 1 is doing DHCP, your computer should receive an address from it. If everything looks good and you have a S/N of 20 or better on both ends of the link, you can set the AP to use proprietary bridge, and then set the client to be in WDS mode.
Hope that helps. Assuming that you're using the built in panel antenna on radio1, you might want to go to config>expert to make sure that the radio is using antenna1 for TX and RX and diversity is disabled. Let me know how you make out.