I'm going to share my experience with this dread error message. my nightmare was only short-lived, lasted about 3 hours. But still, hated every moment of it.
I was on my PC working away when suddenly a blue screen came up, the PC restarted and I got the Disk Read Error, press Ctrl Alt Delete to restart.
Then i did and it was stuck in that cycle. i tried booting from the Windows 7 CD and it wouldn't. Then somehow i managed to get the hdd to boot in safe mode. So there i was happily backing everything up. After restarting my PC I couldn't manage to get safe mode again. So back to square one.
I go on my laptop and search google for this error and found this thread on this forum. After reading all of your experiences i found the one most common thing you've all said, about the hardware communication issue. So i thought, i might as well check mine out.
My fix was uber easy.
I opened the back of my PC, I checked the cable going in to my HDD and it felt very firm, didn't feel loose at all. There was lots of dust inside so i cleared that all out. Choaking myself in the process! Then i reattached the cover and rebooted my PC.
It was fixed! That was it, so simple. I believe that there was too much dust clogging up the wrong area of the inside of my PC. So, for anyone with this error, I recommend trying this, check your cables and clean any dust inside before trying more drastic measures such as reformatting or getting new drives etc.
Thanks for everyone's input in this thread, you helped me a great deal. :)