Ok, lets try something outside of Windows to see if the SATA controllers and the port that you have it connected to are working properly.
To do that, you'll need a bootable disc, like a live Linux cd, or a Windows installation disc, or something like the Ultimate Boot Disc. If you don't already have one, you'd need a computer with a working dvd/cd burner.
The bios of the computer will have to be set to boot from the optical disc first, not the hard drive.
If the computer will boot up using one of those types of discs, you know the hardware is good.
If it isn't convenient to try a bootable disc at the moment, you are down to a few other options, like looking for motherboard chipset drivers which usually contain the SATA controller drivers. Or trying another SATA port on the motherboard, or trying new cables.
Or you can go back to a restore point made before you started having issues.
Microsoft makes a Fix-it tool for optical drives, but the number of times this has actually worked is miniscule going by results here in our forums: http://support.microsoft.com/mats/cd_dvd_drive_problems