Since I now cannot reboot in any mode, I assume it's a HD problem, all I get now is a blue error screen.
Do you have data on the drive that has not been backed up that you must have? If not, try booting from the CD and doing the format/install procedure. If the XP install hangs or fails...there it is...dead HDD.
If there is data there that you must have....that's bad news.
You may be able to take that drive and install it in another machine (a friend's perhaps?) as a slave drive so you can see if it is accessible to get that data.
I am curious about your computer problem. Have you made any progress?