Ok, I got a error message when I first turn on my computer saying

A disc read error occured
Please press Ctrl + Alt + Del to restart your computer

This is really about the 10th time my hard drive has failed, but I could atleast reformat my hard drive before, but now I can't, because when I load Windows XP setup it shows up that no hard drive was detected, and I've had my hard drive replaced twice before all of this happen, and this is a really bad time for this to happen, seeing as my Dell warranty expired in October 2004 I believe?

I've tried to go into my BIOS and modify entries, but that did no good. I read once about this error message that it means your hard drive has failed and it cannot be recovered (which I really need to recover, since I have really important files on my HD). I'm under the impression that the only other alternative is to get a completely new hard drive, but I have no idea what is compatible with my system, I'm wanting a 250 GB hard drive. I heard somewhere that no matter if I get a 250 GB hard drive, that the type of computer I have can only pick up 140 GB of that 250 GB hard drive. Specs are below if you wanted to know them. Is the 140 GB issue true??

My main computer specs are below, it's not exactly the fastest computer:

  Dell Dimension 2100
  Windows XP Home w/ SP2
  128 MB of RAM
  1.1 Ghz
  

**Oh yeah I was wanting to update my enter system, I heard from friends that customizing your computer is less expensive then getting a brand new computer package. I just have no idea where I would find all of these at? (non-expensive parts)
      

Any help would be great!!!!! Thanks.