Vexing Problem-Dell D600 Laptop

I have a Dell D600 laptop which is now about 6 years old. In 2008, I
upgraded the hard drive from the original 80 GB Fujitsu drive to a
Western Digital 160 GB drive (NTFS formatted). Until last week all
had been well with the system (the full hard drive was recognized by
Windows XP Pro SP3 even though it was identified as a 137 GB drive by
the BIOS, and it booted just fine).

Then, upon rebooting I received an error message "A disk read error
occurred. Press CTRL-ALT-DEL to restart." I retried to boot several
times and received the same message. On the chance that the MBR or
boot files had become corrupted, I tried to run the restore utilities
from the Windows installation disk, but the Windows installation would
not load completely.

To remove the CD/DVD drive as the source of the problem, I loaded a
live CD installation of Kubuntu which did just fine. It even found
the files on the hard drive. Likewise, gpartd was able to see the
drive and the files on it.

I could install the drive in an Apricorn EZ-Upgrade device and read
the files on the drive via a USB connection to a desktop computer. [I
copied over my working files just in case.]

I also used Western Digital's tools to diagnose the disk, but no
problems were found. I did a memory test of the laptop, and no
problems were found.

Finally, I reinstalled the old hard drive and used the Windows XP
installation disk as though I was going to install the OS on the
Fujitsu drive (it had been wiped clean). The installation routine
started just fine with this hard drive.

I also tried to use a Windows 7 trial disk to see if the drive could
be recognized, but it did not see it.

So, I have a hard drive which can be detect by a working Windows
installation, which can be seen by a live CD installation of Kubuntu,
but which will not boot and which will not serve as an installation
drive for Windows.

Does anyone have any ideas?