Error 0x80070057 during clean install - cannot format partition

I have a HP pavillion dv2618ca laptop that came with a pre-installed Vista Home Premium. I've recently done a clean install of Windows 7 Professional 32-bit on it and it was working well for about a month. However, today at startup the aero look of windows suddenly failed and when i tried to restart the laptop it'd load the Hp welcome screen but not the OS.

I then inserted the Windows setup disk to attempt a repair, which it attempted to repair Boot Data problems several times but the problem was not solved. Every time I try to boot from hardrive i'd get the BSOD and the laptop would reboot, but the BSOD would flash too quickly for me to read the message. But I had managed to backup my data by clicking on Load Drivers option and do copy paste on the folders I need.

So then I tried a clean install of Windows 7 again. But when I try to format the disks I get a message that the partition cannot be formatted. When I click on next I get Windows cannot format partition on drive 0 - error 0x80070057.

I've tried to reload my Vista System Recovery Disk but I get an error, I've tried Load Drivers with the HP harddrive firmware (it doesn't recognize any driver), the HP BIOS doesn't allow me to do system configuration. I run Memory Test and Hard drive diagnostic in BIOS and both passed. I also tried to create partition with diskpart in command prompt but it seemed to made the problem worse, as now i am no longer able to create a system partion. I'm about to tear my hair out...
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