Failing hardrive

You cannot - you'll either need to start with a Windows 7 ISO image (download from digital river) or contact Dell to purchase a copy of the recovery media.

See here, you should be able to update Dell Backup and Recovery to the latest version and use it to make a Recovery USB:

http://dellwindowsreinstallationguide.com/dell-backup-and-recovery/

However its likely too late to do this because of the shape of your hard drive. To download Windows 7 and clean install see here:

http://dellwindowsreinstallationguide.com/download-microsoft-windows-and-office/download-microsoft-windows/

http://dellwindowsreinstallationguide.com/a-clean-install-of-windows/a-clean-install-of-windows-7/