Wet chipboard floor, heeeeelp!

[sadgrandad]

Due to seepage from an undetected long-term leak (under vinyl floor covering), a big chunk of my t&g chipboard floor has disintegrated. When I started to rip it up, I discovered that there is polystyrene underneath which is covered by a clear plastic membrane, so I take it this all sits on concrete. The chipboard just seems to sit on top of the polystyrene without being fixed in any way. A partitioning wall seems to sit on the floorboards, rather than the boards butting up to it. I've read advice about using a circular saw to cut out old boards, set 1mm shallower than board thickness.

1) Any advice gratefully received.

2) Can I lay ceramic tiles on this type of floor?

Thanks, Sad