OS X :: Snow Leopard Corrupted My Hard Drive -> No Backup

Yesterday, I stuck the upgrade DVD in and started the upgrade. Half way through the process it rebooted. At this point a big warning sign came up saying there has been errors, please reboot (I haven't seen this again). The current situation is that the macbook (Black 250gb) boots for around 20 seconds (grey screen with apple and ajax style loader gif thing) before powering down. Attempted remedies and outcomes. I have reinserted snow leopard and leopard to check the disc utility. It tells me quite quickly that the disk needs repairing. On clicking repair, it tells me that it requires me to backup erase/install. I have attached the mac to a macbook pro (the one I'm writing on) using target mode. The host (this one) cannot see the disk in finder mode but can in disk utility. The hard drive of the target is grayed out and i cannot right click for further options (such as reveal).

I have tried starting in single user mode but I get the following message: Singleuser boot fsck not done. I have tried starting in verbose mode but i get an I/O disk error and then it turns itself off. I have tried to force mount the target in terminal but it says resource busy. I only have myself to blame as it is inexcusable not to backup prior to an upgrade. I'm just so used to mac products working perfectly. To make matters worse, the last backup was on a hard drive which i have just found out is also corrupt (and my itouch stopped working today too!). So basically I have no backup. To portray the gravity of the situation, the info on the computer is a 1.5 year project. that's basically over a 5th of my life that I may have to repeat! The problem (from reading) is that the file structure is messed up. I'm sure that my files are there, it's just I can't access them.

My question is simple. How can I find and copy files from the broken macbook to this new and working macbook pro.