Do NOT use Disk Utility or FSCK -FY in ML

I am really frustrated.

Earlier today, iPhoto was misbehaving so I rebuilt the libraries then restarted the machine and ran disk utility. Disk utility threw up all kinds of red flags so, I restart the machine into single-user mode and ran FSCK -FY (What I've been doing for years). That told me it could not repair. So, I boot into the mountain lion 10.8.2 restore drive and run disk utility. It then tells me that it cannot be repaired and the whole hard drive has to be reformatted. Luckily, I have a Time Machine backup so, I format the hard drive And then start to restore from my encrypted backup. I go about my business and five minutes later I noticed it had restarted. So then I am back in the recovery drive options and choose Time Machine backup it won't connect to my external hard drive. I put in my code and it just sits there. So I then try plugging in to a MacBook air running 1082 and it does exact same thing - you can't mount it and DU says it is bad and needs to be repaired. THE ONLY PROBLEM IS THAT WHEN I PLUG IT IN AND PUT IN THE CODE IT DOES THE EXACT SAME THING - IT JUST SITS THERE.

The thing of it all is that I have zero formatted this computer two weeks ago and reinstalled everything from scratch, starting fresh and now I'm almost basically completely dead in the water and have deadlines for work and I don't know what to do. Did I just lose my 230 gigs of 10 years of photos? Does that mean I just lost all of my work from the last 10 years because ML, in one swoop, corrupted my main drive and then my backup drive wile actually trying to bak up from it?

What the heck am I suppose to do now???