Hi Sanga,
This was the sotware we used when I joined NetScreen/Juniper. From searching my memory, I remember that the firewalls always used to come in transparent mode by default. This was changed at a JTAC request later on(since not many customers use transparent mode). To change it out of transparent mode, if I remember correctly, all you need to do is set the IP addresses on the interfaces.
This is before the concept of zones (introduced in ScreenOS 3.1), so it is literally just a matter of setting the addresses.
In current architecture, you would need to unbind the layer 2 zones, bind the layer 3 and set the IP addresses, so it is similar, but without the complication of zones.
I think what's confusing you is that it is in transparent mode by default, and today, we don't do that. Ignore that, add the IP addresses and the box should operate in NAT mode, and the option for ROUTE mode will become available.
Let me know if this helps, this was all a long time ago, but hopefully I'm remembering correctly.
Regards
Andy