If you're seeing bad sectors, replace the hard drive wih a new one - you will need a new, 2.5"9.5 mm SATA notebook drive.

before spending out on a new hard drive, are there any other tests i can run? The dell diagnostics (F12 on start up) showed no errors.

When you ran  the Dell diagnostics, did you do the extended test (takes about 90-120 min) or the 10-min quick test?  The quick test won't catch all possible errors.

Be careful in cloning this drive if you try - the Media Direct partition causes problems.

Go to the disk manufacturer website - usually there are diag tools there that go deeper.

However, once i see such errors on a disk, it's instant retirement time.

Usually i instantly remove the disk, put it an USB drive enclosure, copy critical data by hand then try to make a drive image.

Driveimage is then pasted on a new disk.

How do I check who the disk manufacturer is? would that be dell?

I run the full extended test on the dell diagnostics.

Cloning the drive? Sounds a bit technical, do I just need to copy my photos/music/documents onto a usb then put them on to the new hard drive once installed? What about all the programs etc that come pre-installed on the laptop?

What is involved in swapping the hard drive?

http://support.dell.com/support/edocs/systems/ins1520/en/SM/hdd.htm#wp1180023

Any further info on how I would go about replacing the hard drive?

thanks for the link, I have just received another blue screen crash and restart, I didnt get chance to read it all.

The last line said "dumping pysical memory to disk"

Does this mean anything to anyone?

Could be - but it could be a failing hard drive instead, or as well.

I am getting my mem replaced with new modules, are they what caused the blue screen?