|"Is it safe to assume i need to replace the hard drive and if so can i put a better one with more GB in it?"|
Likely, since you state that the HDD is making a new noise you've never heard before.
"Also do i need new software to down load onto my computer so i have my windows and everything else as it was when i got it?"
If you don't have the original OS discs and software that came with the machine, then yes, you'll need both...
"Channeling the spirit of jboy..."