The 100MB volume was most likely created by Windows 7 Setup if it's labelled "System Reserved". It would have contained the Boot Manager for your previous Windows 7 installation. If the drive wasn't present when you installed Windows on your new drive, there is no way the old drive can be coupled with that.
As regards the bad sectors, the only safe thing to do is throw it away as the number of bad sectors will increase.
I would never trust a drive on which bad sectors had started to appear.