Windows problems! Please!

Hi! My name is Mattias and I'm having quite a mess with my computer!
It's a 32bit Inter Core 2 Duo , E8400 @ 3GHz, 2GB RAM
And I have Windows 7 Home Premium installed.

It has come to this: I've installed LOADS of programs and downloaded LOADS of freeware. I have stuff organized and all that because I'm kind of a perfectionist.
But I really really want to restore my computer back to its normal... Like when it came from the store.

I recently had it sent in for a complete restoration because of a crash and that was the time I also upgraded from Vista to Seven. But that cost me alot of money to do and I'm not prepared to send my computer there again for a new restore.

The reason I want to do this is because most of my games dont work. I.E "Warcraft III" , a game that always worked on bots Vista, XP and 98... I've googled around and have not found much info on how I could fix it otherwise... I've tried a whole lot of things.

And also, everytime I turn the computer off or just log out of my Admin account (The only account on the computer) I get some "Bad mem" notice. A programwarning if so.

I'm not so good at computer so I'm asking you Windows fellows, where should I turn? What sould I do?

Thank you in advance.

Wow fast replies! Thanks alot!
Rich, yes I want it to be as when I intalled Seven.
But wont there be a problem since I only have the "upgrade" disc?

Thanks again Rich! Are you posting a link here or what? Sorry I'm just really new to having problems with Windows... hehe. At my school we use Mac and lets face it there's never any bigger problems there so I'm not used with having to search for help.

Okey I think I get it now, but to do this I need to format my computer first ?
Or do I just need to insert the CD and do what it tells me ?

Will the dvd create "Windows old" Or something like that? Because otherwise I should make a backup?