what is wrong with my ps3? how do i fix it?

ok well this si really a big problem.... you see, i was playing the pro evolution soccer 10 demo with my friends, then it froze, but the orange (HDD) indicator was still lit up (solid-not flashing) i tried to hold the power button and it wouldnt turn off. So being a moron, i turned it off using the switch on the back, and when i turned it back on, it would get stuck at the menu, but the XMB wouldnt load ( it would just show the waves background) now, if i turn the ps3 on, it just goes to a black screen, but i can still access the recovery mode shwon in this video http://www.youtube.com/watch?v=yZWye1CLTVo&feature... so did anyone ever experiance this before? should i restore my ps3? is it possible to copy my save files or something so i dont have to restart? i know that trophies/purchased goods are tied to your psn account, but i dont want to restart all my games. and also i got the modnation BETA- so if i restore my ps3 and download it again from my psn, will it work or will it give me a message telling me that the max number of downloads has been made? please help i dont know what to do and i really dont want to mess up my ps3 because its an old 80GB with 4-USB ports , a built in fash-card reader and it supports ps2 games.