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PC start up problem

Have a problem with my PC. Its a Dell Vostro 200 E6600 Core 2 Duo Processor 2.40 GHz, 1066 Mhz FSB with Windows Vitsa and Office 2007.
Tried to switch on PC last night and it came up as grey text on a black screen before boot to say Windows has encountered a problem and had two options, one to scan & fix (recommended) and two to continue as normal.
We went for first option and it came up as saying it would take a few minutes and in the process it had a blue bar that moved from left to right as I presume the system was fixing the issue.

However after twenty minutes of this I decided to cancel and try to continue, however this just lead me to a blank screen. Now if we try and switch on, after the initial Dell screen and a screen which has a Microsoft progress bar on it, it just goes through to this blank screen. I do have an option on the initial Dell screen of F2-set up menu and F12- Boot up menu but not sure what to do on these options.
I do have windows reinstall discs but I do not want to lose any files on my hard drive.


Any suggestions for a novice? A local IT company has offered for £50 to back up the hard drive and reinstall windows but only wanted to go down this option if there's nothing else I can do.

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