Let me try to answer your questions. In the process I might have a couple more questions for you.
-came with Win 7 (don't know if it's 32 or 64 bit): Click Start button, then right-click Computer, click Properties. You'll see a brief description of your computer and under "System" it will tell you if it's 32 or 64 bit.
...if that hidden partition will restore my laptop to the condition the day I brought it home that's something I would consider. The easiest way to find out if you have a hidden recovery partition is to open a built-in utility called Disk Management.
How To Open Disk Management From the Command Prompt
If you have a hidden recovery partition you'll see something similar to this:
If you're not sure you could
include a screenshot of your Disk Management window.
-Windows 7, it was already there but not installed: I believe what you're referring to is the "first-time setup". Windows 7 was actually installed on your computer when you got it. But the first time the computer is turned on, it walks the user through an initial setup. This first-time setup lets the user configure things like the time zone you live in, the currency you use, etc. So
if you have that recovery partition, and
if you use it, Windows 7 will still be on your machine and YES you'll have to go through that first-time setup again. This YouTube video shows what the first-time setup looks like.
Windows 7: First Boot Setup - Micro Center Shows You How - YouTube
-What programs will be erased?: Anything that you installed after the first-time setup will be erased. Your computer will be exactly like it was the day you brought it home. NOTE: There have been some reports by some computer users that the free Microsoft Office Starter version will NOT be included in the recovery process. So you'll have to verify which version of Office you have (a paid for Office will include at least Word, Excel, and PowerPoint.) Did you at any time pay for a license for Microsoft Office? Or do you know which version is installed? Other free programs like Adobe Flash can be updated and reinstalled if necessary. Things like Notepad, WordPad, Calculator, Snipping Tool, etc are Windows 7 utilities and will be available after a recovery.
-And saving files etc.?: Saving your personal data is a must because a recovery will erase all of it. Depending on how many files, photos, documents, music, etc you want to save (and this will be determined by how many megabytes or gigabytes of data you have), you can save your personal data on a disk, or a USB flash drive, or an external hard drive.
And most importantly will this rectify my issue.: It should. Again, a recovery partition should return your machine to the
exact condition it was in when you brought it home from the store. No popups, no malware, faster loading of YouTube videos, etc. Just be aware that when dealing with computers, "stuff" can happen. I cannot give you a 100% guarantee. Best I can do is say that in the vast majority of cases, people who use their recovery partitions wind up getting a brand new computer.
A question for you: Did Acer provide you with an disks at all? An installation disk, recovery disks, etc? Hope this helps. Feel free to ask any other questions.