Failed Read test - multiple problems

[Sree82]

Hello all,
I have an Windows XP on my Dell Inspiron 6000M model. SP1
First I started having the notorious blue screen “ stop errors” bothering me.
I had to keep re-booting my system from the CD time to time.
Then one fine day – it said – very low virtual memory. Before I could anything everything got stuck. Tried re-booting again. This time, as soon as I logged in, it said the following “ WLAN error”..although I could connect to the internet.
Could not open any page containing videos, passwords, user id type’in’s ..no audio files.
And the system would get stuck as soon as I opened any web page.
..So, I hit F12..and wanted to try diagnostics….it said “no partition diagnostics” found or something like tht…
then…I put in the diagnostic cd…and tried the symptom test for blue screen…and hardware problems….it failed the read test…also I ran the quick test…there too…the read test failed…
also, the touch pad gets stuck...and the computer does not recognize USB DRIVE...or the usb port..or any external device attached.
what does this mean..? what to do now..?
how to recover my laptop…..?
please …any info will be useful….but am not a IT person…