Right off the bat I would wager that your hard drive has failed, but since a friend of mine had similar trouble recently this is what you could try.
Remove all sticks of ram but one and try to do the install, if it fails try it with the other stick. That should eliminate ram feilure as a cause.
Then you can try to partition the drive into segments and then try to install windows on different partitions, that might help you miss the bad sectors if the drive indeed has failed like that and you may get some temporary use out of your puter till you get another hdd.
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