Actually Debb, the bike would be much better for your knee than say walking or running. Not saying that those are bad activities to do, just that with cycling it puts less of an impact on your knee joints than walking or running.
Granted my idea of cycling is the goofy outfit and doing at least 20 miles. But you don’t have to do that, Studies have shown that even a casual ride around the neighborhood for at least 30 minutes offers really good benefits.
Going back to the knee issues, At first you will notice some pain if you don’t ride very much. But over time as you do it more your knee will develop the muscles, ligaments and tendons to develop a stronger knee. Also your Omega 3 fatty acids help with development of joint stuff. I take a couple of fish oil gel tabs everyday (which also helped my Cholesterol numbers) and that has helped.
The ball is an excellent idea. I have one but I don’t use it nearly as much as I would like to.