You can back up iTunes in two ways. Doing it from iTunes itself is safer (but not always more convenient).
This is how:
http://docs.info.apple.com/article.html?artnum=302392
And doing it yourself, you need to click the "Unlock" option and then you can just copy your whole "My Music" folder.
Again, here's a detailed how-to on that:
http://docs.info.apple.com/article.html?artnum=300173
If you want to back up everything, just use any disk imaging software or easier - system restore that comes with windows.
As for your hard drive, what is failing? Did it fail a SMART test or is it just the file system?
I have had both happen to me, the SMART fail is weird. I had a drive "Burn out" and sometimes it would refuze to start, but if I let it cool down, it'll work again.
As for a file system, you can do two things:
1. Get the manufacturer's software bootable disk (Like WD's Data Lifeguard or Maxtor's Powertools) and run all scans and repairs you can. They work hard.
2. And this is what worked for me, but it takes a bit more work and experience: I downloaded and burned a Linux Live CD (boots from a CD/DVD) and I used the utilities to manage my drives from the operating system while my drive isn't in use.
For the rest of the programs... It's too much work to back them up, you'd need to search tons and tons of folders in the registry and back them up, organize and then restore individually. You'd be better off just re-installing. Plus, a clean start always makes your PC run better for a while :)
As for Disk Imaging.... I'm not a fan... If you have any errors in your files or undetected viruses etc... it'll just copy them over and you ARE risking the blue screen of death (and as we all know, that's not a good thing) by starting the PC up with different hardware.