My first thought is that a laptop six years of age may not be worth investing in. You are already looking to investing in a hdd, and if you haven't replaced the battery by now you will be looking at doing so in the near future. There are electrolytic capacitors which at this age have probably already started breaking down, this could eventually cause your motherboard to fail.
What this boils down to is what can you afford to do. If you can afford it a new computer that would be my choice.
But if you are on a tight budget I would suggest making the repair and hoping for the best. Replacing the hdd isn't that difficult. If you can read and follow instructions you could do this quite easily. There is a how to video for replacing the hdd, you can watch it here. After you have installed the new hdd you will have to install the operating system, if I'm not mistaken this is Vista Home Premium. You will then have to activate your copy of Vista.