Back up your files and reload it. My guess is you have a corrupted system file and that is usually a hard drive going away. It may respond to a format (full) but if it is really going bad that will take forever and might not finish.
As long as you are absolutely sure you got the key right (not using a 5 for a S and stuff like that) it has to be the file that it matches in the system nucleus.
What version is this? I have a W/XP pro Dell restore disk