How to diagnose Windows 7 desktop freeze due to hard disk failure

The story :
Our sales department Ginny told me her PC consistently hang. Upon restart, Windows run check

disk and report repairing files. Once boot in Windows desktop, it hang again. I  had removed some software such as third party CPU speed booster and antivirus software that might caused it to hang, but it happened the next day. 

Specification :

- Asus P5P43TD Board

- Intel Core 2 Duo E7500 Processor

- 4 GB RAM (2+2)

- Western Digital 1.0TB Hard disk WD10EARS

- Win 7 Home Premium 32 Bit

Additional information :

- Windows 7 Desktop Freeze (Mouse can move but in circle& can't click anything)

How I check :

1. Boot into safe mode and check event log for errors
2. Found the following error "\Device\Harddisk0\DR0, has a bad block" (picture below)
3. Take hard disk out and connect it to another PC. Run disk diagnostic tool such as
   check disk and HDDscan 3.3

What I found :

Disk check result confirm defective hard disk that caused Windows desktop to freeze (due to unable to read files) (picture below)

 

How I fix the problem :

1. backup hard disk files in user profile (c:\users) into external hard disk (check other
   partition or folders for files to backup) 
2. change a new hard disk and re-install Windows
3. restore files from external hard disk

Additional note:

• If Windows can boot to safe mode, make sure check (system) event log in control panel - administration - Event log and check for problems (!).
• Backup files to external drive before running hard disk test
• Disk utilities as disk test may further damage the hard disk and cause permanent data lost
• Despite disk utilities can repair the defective hard disk, I don't recommend to continue using the hard disk due to it may fail again soon.