Can't boot or format?

Right, my computer has been running fine. It's a custom built, about 8 months old. Everything was running fine and dandy, except now my computer can't boot up.

Windows attempts to load from the Hard Drive, and after an extended time(moving status bar), it just crashes and resets. I changed the settings to allow me to read the BSOD, and I get the following error.
unmountable_boot_volume
I did a google search, and found some help saying to use windows recovery console.

So I pop in my windows disk, everything loads up, and I get the following problem. I try to go to recovery console, and it freezes. I try to instal windows "delete partition, etc." and it freezes. While it freezes it says at the bottom.....
Examining 476938 MD Disk 0 at Id 2 on bus 0 on NvAtaBus....

So I figured maybe it's my clocks, so I went to default, doesn't help.
I tried loading fail safe defaults, computer doesn't even boot from hard drive, and windows disk still doesn't work. Tried switching SATA ports, still didn't work.

Here's the hardrive...
ITACHI Deskstar P7K500 HDP725050GLA360 (0A35415) 500GB 7200 RPM 16MB Cache SATA 3.0Gb/s 3.5" Internal Hard Drive - OEM

On newegg reviews, had a lot of "Dead after 3 months", so I'm guessing it's the hard drive, but why would it try to boot up if it's dead?

I just need some help here. I bought a new drive(WD) and hopefully that will work, if not than what could be the issue? BIOS reports that mem is good, CPU, and everything else in my system works.

I really don't care if the hard drive is dead, like I said I bought another, and maybe I can RMA this one. It's just that I will lost the last 2 weeks of work that I've done, which means I won't get paid for a couple of contracted jobs(3D design).

Thanks in advance for anyone who can help!

download lifeguard tools and make bootable cd

http://support.wdc.com/product/dow [...] 30&lang=en