Dealing with a soon to fail 1T sata drive

Hello all,

Thank you for time and assistance.

Few days ago my system became extremely slow, I checked the HD status in "Intel Rapid Storage Technology" only to find, to my horror, my HD is reporting an error and it's at risk.
This laptop is 4 years old, I don't see how it could happen but all my professional life is on it. Yesterday I rebooted and it didn't find the desktop file at first, only second reboot helped.

Questions:
1) will defrag help, will it move stuff around to the better parts of the disk?
2) If I ghost the entire drive, isn't it true that it may copy corrupted sectors?
3) I am using less than half of the drive capacity. How do I "move" the windows installation, activation code, laptop drivers and all to a smaller drive if I don't want to buy a new 1T. This is assuming I can make a list or backup the rest of the software on my pc including activation codes etc.
4) Why ME????

Thank you again for your patience and assistance.
Y.

Thank you prickly one for your quick response.

I will go through each and every one of the links you provided, but if I may, before a followup:
Since my HD is soon to be deceased I'll need to get a new one and move the image there.
When I use the solution you gave me, will I be able to boot from the dvd (ghost style) in order to "extract" it all and basically continue as if nothing happened?
If I skip the bad sectors, isn't there a chance the image itself will be corrupted and some files may be missing?
Do I need to buy the exact model or just the same size will do? Logically, all the drives in the system work with the old one, so if I restore as-is to a new type of drive, isn't there a failure option?

Thank you again,
Y.

You can buy a smaller or larger hard drive... as long as it can hold the files.

I asked because in the old days when we used Ghost, it was a bit-to-bit copy so the HD had to be the same size.

"isn't there a failure option"? Please explain what you want to know?

System image created with 1 type of HD, drivers for it and all. Restoring to a different type (vendor,size) will not make problems?

You can make a bootable DVD from within the program. But you can better do that on a working machine!

How it is possible?... The HD is dying so I am going to make the backup now, rush to the store and get me a new HD. That system will not be operational. I have only the one laptop.
Am I missing something?

Y.