After updating to Lion 10.7.2 System now hangs on boot

I downloaded and installed Lion 10.7.2 update last night onto my MacBook Pro. The update appeared to download ok after quite some time, but during the install the system appeared to hang transfering files. I left the system installing over night, but when I looked at it this morning the update had not completed and I was not getting any responce from the system at all.

Now when I reboot the system I get the Apple logo with the status simbol pinning, but thats it. I have booted into Verbose mode and it looks as if the boot is hangs on the BlueTooth driver install.

I can get into the Mac OS X Utilities and was thinking of reinstlling the MAC OS, but am unsure about this as I don't know if this will erase all my data.

I am fairly new to Mac trouble shooting so any advice would be greatly appreciated.

Thanks

John