Note you can not set a midi instrument patch in the melody track unless it contains some midi data (notes) . once you have notes in there chose you patch. The melody track will now take on the name of the instrument instead of just reading melody.
This is also correct. For a quick test you can go to Melody | Melodist - Generate Melody and/or Chords.
Then click on your Melody track in the mixer and go to Select MIDI Instrument (Patch) | Select General MIDI Patch. Here you should be able to change your MIDI instrument entirely.
For future reference if you ever need it, there are two options when you select Return to Factory Settings, Most and All. Most will retain your audio and MIDI device settings so that you do not have to redo those in the Preferences. This is a good option if you are using an audio interface or a MIDI keyboard.