Hard drive fail warning - how to upgrade?

I have a Dell XPS whic is reasonably modern (i7 CPU, 6GB Ram, 64 bit) where I now get frequent warnings that HDD will fail soon. I have backed up my data. I plan to install a new drive and have some questions:-
1) I have a lot of software installed and not sure I have all the discs - is there a way to copy the whole drive (I have a NAS server with plenty of space on my home LAN whic would facilitae this), install the new drive and then copy the saved version back over?
2) Should I go for HDD or SDD? (i don't need super high capacity - I can keep data on the NAS)
3) The machine is Vista - should I upgrade to WIndows 7? I expect that if the "copy drive" approach works, then I will not do this, but if I am faced with full manual software reload, I might as well upgrade the OS, right? I don't like to look of Windows 8, for now at least).
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More about hard drive fail warning upgrade
  1. if you still have acces to that drive and get another one you could use tool from drive maker most of them use acronis true image to transfer all the files on the new drive so you wont have to reinstall the software
  2. Thanks. Is there a way to upgrade from Vista to Windows 7 while still keeping all of the software?
  3. The upgrades aren't guaranteed to keep software. I'd never do an upgrade install myself.

    Easeus has a nice free.disk clone tool, and there are others.

    You can also download must software install disks and there are tools to extract you product keys from the registry
  4. copy to copy with the same os work great but for the upgrade it will be better to reinstall all the software also check if the parts in the system support win 7 before upgrade
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