Install versus reinstall - lose everything?

The only restore points that escaped disappearance were on an external drive, and were 3 years old!

That's unfortunate (re. Restore Points). You should always have at least 1 recent one.

Coming back to your issue when you get your new W7 copy you had better know what your product key is as you won't be able to activate W7 without it. If you can still boot up you can find that out, or you may still have a COA sticker on your PC which displays it. It also has to be the same version of W7, eg you can't activate for W7 Ultimate if the PK was for W7 Home. You may be given a new PK with the W7 disk you are buying but it may not be genuine. If it is and it's for a different OEM W7 version than the one you have, then you can try and use that, but be warned.

Unfortunately when you install W7 you will lose all your software as I expect that's on your C: drive, and they will be wiped, so make a list of all apps already downloaded. If you go to Programs & Features they should all be listed in there. Also make sure you know where all the drivers are for your PC, usually listed under the manufacture's website. That's a fairly big task you'll need to do once W7 is installed and you've activated.

The PC was shipped (to my dad) with Windows XP, then upgraded along the way to W7. For that upgrade they used volume license, so since PK sticker is gone, I had to use PK Finder software. All I get back is BBBBB... So the new copy W7 had to be genuine, or it definitely wouldn't work. It's a sealed OEM copy of W7 64 AND 32, so I should be safe there.