Yup, that's a dying drive all right! I'm actually surprised it's not completely dead yet with all that noise. I've had them die long before ever getting that noisy.
You can sometimes coax a little more run time out of a drive if you need to pull data off of it for a new drive by mounting it in an external enclosure and cooling that drive in your freezer. Put the drive in a ziplock bag and put it in the freezer for an hour or two at least. Take it out of the freezer and connect to your computer via USB or FireWire. You could get an extra 5 or 10 minutes of run time before it freezes up, just long enough to pull off your critical files if they're not backed up.