Windows 7: Blue Screen and Memory Dump after opening directory with many images

I downloaded the hdd manufacturer's diagnostic tool and after the extended test it said there are some bad sectors that may be repairable.

I want to back up the whole thing before repairing. What's the best way to back the whole thing up? Or what should you back up in cases like this?

Also, it has a repair button to try to repair, should I use that one or is there something better?

Everyone should back up everything once a month
Imaging with free Macrium
Use the repair and then test, again.
Now this is what you should know. Lets assume that the problem with the Hard Drive is scratches (to make it simple) that cant be read. The repair does not remove the scratches, it just sets up the hard drive that those sectors will not be written on again. Bottom line, if the Hard Drive was the cause of your BSOD problem, they will not stop because of this repair.

Thanks.

So I backed up the drive, ran checkdisk and there were bad blocks which it repaired. I attached the result log of the checkdisk. I looked at the windows event log and since the chkdsk there hasn't been any errors from the disk. Things have run ok so far since the chkdsk.

However, bad news is that the quick test and extended test of the western digital drive dianostics both failed, even after the checkdisk. It always gets stuck towards the end and says something like cannot read a part of the disk and the error code number associated to it.

My question now is what to do with the disk. Does it get worse, ie. once there are bad blocks it just keeps increasing over time? Also, how bad is it, is there a way to know what area is busted and how bad?

I'm hoping I don't need to replace it because I'm really, really tight on funds at the moment.

Errors are due to two reasons. One from a one shot deal; bad shutdown, etc.
The other is that your Hard Drive is failing. The advice that we give to all, because there is no way to tell is to back up your stuff and get a new hard drive. The alternative is to use the computer and just hope for the best.
I do know that your hard drive IS STILL damaged, the fix was just a bandaid that hides the damage from the computer.
That being said, you have just 24kb of bad sectors, not very much.
Lets try an SFC and see what is damaged.
SFC /SCANNOW Command - System File Checker

Richard,

Thanks for all the great help.

Sorry it took a while to reply, was away for work for a few days.

I did SFC check and put the log into a text file.

I don't really understand what it means, aside from the longer lines which indicate problems.

What do you think?

Dont know where I said the bolded section.
In any event, the HD, does have problems, the OS does have errors. I have to assume that the HD as a cause of your problems. You failed the HD test.
I suggest that you back up your stuff, NOW, and have an expert look at the HD.

Will do. Thanks for the help Rich.