Does it show up in BIOS?
Does it boot your original install if you remove the 160GB drive?
It sounds as if either your 500GBis dead (for example the read heads are not reading but there many reasons that it could not work and still spin) or you have conflicting hardware, ie two C:'s.
In BIOS, if the two drives are detected, select an option called boot override (or something similar) and select your 160GB drive. If that works, you may be able to get what you need off the 500GB but you will probably need to reassign the drive letter of your old drive. It's possible that you may need to run chkdsk or something similar though in order to do that. A Windows install will be a primary boot partition and that's not what you want for a data drive. Chkdsk should also help you change that.