Hard drive SMART failure

I'm working on a HP a650e. Here's some background that may or may not matter: It had a dead PSU which I replaced yesterday. It booted into Windows and I proceeded to do some tuning up (CCleaner, defrag, etc). Over 4gb in junk were removed by CCleaner. I ran Auslogics defrag and when it finished there was some red type that said "44 files are unomptimized" or something like that; I have never seen that before with Auslogics defrag. Just out of curiosity I ran the Windows XP built-in defrag, during the 'analyzing...' stage a balloon popped up by the clock that said "corrupt files have been found. Run chkdsk" which I have never seen before, so I entered the command prompt console and scheduled chkdsk /r to run at the next boot. It took about 7 hours to finish; it sat at 0% for over an hour, and sat at 80% for maybe 75minutes. I had a thread about it the Software forum. Chkdsk found and corrected MANY problems and prompted for a reboot when it finally finished. I rebooted and got a SMART status bad message when the PC went through the post. So I said "I'd better save the data while the drive is still accessible" and booted to the UBCD4Win and saved over 7gb of pics/docs/music/favorites to an external drive. I then ran HDTune and there is only one error: an allocation error. I've attached a screenshot. Is there any way to fix this? Should I try to image the drive to a new one? Is there a chance the drive will completely fail while I'm trying to image it?
Any and all suggestions will be appreciated. Thanks!

 

I will try the image of the drive if your lucky this will work....

In the last effort you could try the Freezer thing it work for me a few time....
But after that the harddisk is done for.....