Windows 7: Hard drive failing, what to do

My primary system drive where Windows 7 is installed is a: WD 7K 16M SATA2 WD3200AAKS HD 320G - OEM. Long version (feel free to scroll down to short version): Yesterday, I came back to my computer, and all of my applications and desktop were frozen, but I could move the mouse. When I clicked on a window, the cursor would turn to the blue spinning thing, and the window would eventually say not responding and turn a lighter shade of white. I couldn't click on the desktop of the start menu, so I did a hard reset. The computer then wouldn't pass the black "starting windows" screen. I did another hard reset, and it asked me if I wanted windows to try to repair start up. Soon after that, it asked if I wanted to restore windows, but when I clicked OK, I got what looked to me to be a memory error (sorry, don't recall what it said). Then startup repair seemed to do nothing for a few hours, till I got impatient and restarted the computer. I was able to get into Windows, and I scheduled a memory test, and reset the computer. Memory test ran and found no problems. I restarted and Windows loaded, but soon after my computer was laggy and the programs were freezing. So then I thought it may be a HDD issue, so I scheduled to run check disk on that drive, and reset. Check Disk found corrupt files and bad sectors. After that, I was able to load Windows normally, but when I tried to open MC7 for "Live TV", it wouldn't pass the searching for tuner stage, so I closed out MC7, and got an error message in the action center. So I ran chkdsk again. This time, windows wouldn't load after restart, so I went back into repair startup, and it seemed to have found the error really fast, restarted and everything seemed fine. I decided to run chkdsk one more time for good measure, and it had a couple more read errors and found more bad sectors. Now I have been running windows with no apparent issues yet.

Short version, computer froze, ended up running chkdsk 3 times, had to repair start up, and now everything is OK for now, but obviously I'm worried about more harddrive failure. Here are my questions:

1)How troubling is this? Do I need a new harddrive ASAP, or can it run for years with a few bad sectors? Any further tests I could run?

2)If I am to get a new system drive, what should I get? All I have on it is windows and my programs. I have separate disks for data. I'm using roughly 32 GBs out of 298. Should I just try to get the same drive (same speed, same capacity), or is there a good upgrade and is it worth getting an upgrade (I don't need more space, but something that would help performance maybe?) or any good deals on sale now?

3) I bought my current (failing) HDD on 9/24/2008, and I'm pretty sure WD has 5 year limited warranty. Should I peruse that angle? Any tips or advice related to that?



4)How should I got about moving/restoring this OS to the new drive?
4a) I have a half dozen Windows Image Backups saved. Should I just use an old one from before the failure, or should I try to create a new one now, even though the disk may be corrupt?
4b)Or is there a better program to be using than Windows backup and restore?

Is there anything else I need to know? Thanks a lot for any information.

First, back up everything. When you are done, I will give you advice, but the back up gets priority.

We can test the HardDrive, etc.

Here is a start, but back up, now
http://www.pcmech.com/article/hard-d...and-solutions/

OK, I started creating a system image, like I've done a number of times before. About 80% through, it seemed to get stuck, and my computer became mostly non-responsive/frozen, and after another 15 minutes of waiting, the screen went black and I couldn't get anything back, so I did a hard reset. It was stuck on the "Starting windows" screen for about 5 minutes, before it went directly into chkdsk. It found some more errors, then restarted. However, after POST, an error message "A disk read error occurred" and asked for a C-A-D. I then tried booting off the install DVD, and tried to do a startup repair from there, but again got the same disk read error on restart. So looks like now the drive has failed even more, and I can no longer boot from it. I'm considering finding a way to run chkdsk from DVD or something similar. I'm guessing the backup failed, but my previous backup is from June, so I haven't lost too much... oh boy. what now?

Try to save your files, then we talk or at least type.

PC Inspector FILE RECOVERY

Your HD sounds like it is having problems

On another partition on another drive, I have my old pre-Windows 7 XP OS. I changed the boot order and got into XP just fine (though it wanted me to install some new hardware that I added since last booting into XP). I ignored that, and went into mycomputer. It could see the Windows 7 drive just fine. So I went and backed up the few new files that I don't have imaged from my docs and downloads and my firefox bookmarks (can't really think of anything else of use). I already had PC Inspector installed on that system, but I ended up not needing it because I could access and transfer the files in explorer just fine. so at least all isn't lost in that regard!

OK, you have your documents.
Follow this to check the hard drive.
HD Diagnostic

If it comes up bad, it is. If it shows ok, it may still be the problem, but we will try to solve the problem assuming HD is ok, but I doubt it.

Ok, I ran SeaTools for DOS, since I already had it burned to a disk, and your instructions said it would work with a WD drive. SMART has not been tripped. Took just over an hour to complete, and found 28 errors in the long test, and failed. It gave me a message to contact my HD manufacturer. Should I have run a WD utility instead?

Assuming that you backed up everything, run the WD test. Then get a new Hard Drive, if it fails. There is no other recourse. But, it does not sound good.

OK. I'll try that. In the mean time, do you have any advice regarding my questions in my OP regarding getting a new drive (warranty question, tips on restoring from image file, drive upgrade possibilities...) Thanks a lot for your help this far!

the WD quick test after 8 seconds:

"Test Completed with read element failure
Error/status code:0007
continue on to full media scan in order to resolve this issue"

which I am doing now...