Where did you get Windows 7 Ultimate copy you claim is geniune? Did you burn the DVD yourself?
What files do you need to get? Why would you leave files on the HD if you're reinstalling Windows 7 which will overwrite them? You can try to retrieve files using Install DVD this way: Copy & Paste - in Windows Recovery Console
Then unplug all other HD's and peripherals, boot the DVD, choose Custom Install, delete all partitions, click Next and Windows 7 will create and format partitions for you before installing.
If install fails then, try wiping the HD: SSD - HDD Optimize for Windows Reinstallation
Next if it fails try removing all but 2gb of RAM to try install. Test RAM - Test with Memtest86+
Swap RAM sticks.