Getting my hard drive shipped back to me?

So, I should probably just call Apple on this, but I'm at work and I figured I'd post the question to the users first and see if anyone else has been successful in this.
So, after downloading the most recent updates from Mac a few nights ago, my computer experienced a kernel panic and then got stuck on the boot up screen at restart. After restarting again, my hard drive wouldn't show up. I called tech support, and they were unable to get it to come up either, but I was told if I took it to a Mac store they might be able to retrieve my information. The Mac Genius at the store was unable to do anything about it either, but he did give me a card for a Data Recovery Service that he said could help. Now I'm in the process of making the difficult decision of whether or not to spend 1/9 of my yearly salary to get four years of my pictures back after I just spent 1/9 of my yearly salary to buy this brand new computer. I understand that it was my fault for not having a back up of this information on another computer...but I'm still pretty upset. Now, even if I do decide to send my old hard drive to a data recovery service, I'd like to have my laptop up and running as quickly as possible, even if it doesn't have any of my data on it. My question is:
Would Apple send me back my old hard drive along with the repaired laptop so that I could then send the drive on the data recovery service or am I going to need to send the whole laptop to the data recovery service first, wait for them to do what they do, and THEN send it on to Apple? Additionally, is there any chance in **** that the Apple technicians would be able to retrieve my information for me and save me 2700 dollars? I honestly don't think there's a physical problem with the drive, and perhaps if the drive was extracted and put into another laptop, it might work fine. It's so frustrating because I know the information is on there...my computer just won't recognize it. I appreciate the help...I'm pretty upset about being in this position with a brand new computer.

How could a failed security update have fried your hard drive? Did you try all suggestions at Macfixit to get it working? Who determined your hard drive is faulty? I think you need to keep investigating a solution before resorting to hard drive replacement.
Tutorial: Startup will not proceed after a system or security update; solving
Many times after a major system update (such as an incremental Mac OS X update, i.e. Mac OS X 10.4.5 or a Security Update) can cause an inability to properly startup -- you may see a blank grey screen, pause indefinitely at the Apple logo, see a blue screen, or experience other symptoms.
There are a variety of potential solutions for this issue.
Delete Caches/.plist files If you experience startup problems, first try starting in Safe mode (hold the "Shift" key while you startup), then delete some cache and .plist files to make sure their corruption isn't at fault.
This can most easily be accomplished with a shareware utility like Tiger Cache Cleaner or Panther Cache Cleaner, but also bears a manual process which involves dragging the following files to the trash:
com.apple.kernelcaches (a folder in /System/Library/Caches)
Extensions.kextcache (a file in /System/Library)
Extensions.mkext (a file in /System/Library/)
com.apple.ATS (a folder in /Library/Caches/)
com.apple.loginwindow.plist (a file in /Library/Preferences/)
Files that start with com.apple.LaunchServices (in /Library/Caches)
You will be prompted to enter your administrator password when dragging these files to the trash. You may need to restart after moving them to the trash.
Check for problematic login/startup items Startup in safe mode (hold the "Shift" key while you startup))
Next, go to the Accounts pane of System Preferences and click the "Startup Items" tab. Select all the login items and click Remove, then restart.
Also, check the /Library/StartupItems and /System/Library/StartupItems folders and remove any third-party items.
Repair drive damage In the case of drive directory damage or problems with permissions, the solution is usually to use Apple's Disk Utility to repair the disk. Of course, you won't be able to perform this operation normally (simply launching the Disk Utility application, located in Applications/Utilities, and initiating a disk repair) if your system will not startup. So two options exist:
Insert your Mac OS X 10.4.x (Tiger) media (DVD or CD) and restart the computer while holding down the "C" key. Once the computer has booted from the installation disc, select "Utilities" from the menubar and open Disk Utility. Repair the disk, then quit Disk Utility and restart your system.
Alternatively, you can repair the disk while booted in single user mode if you do not have access to a retail Mac OS X 10.4.x (Tiger) DVD/CD. To startup in single user mode, hold down the "Command" and "S" keys simultaneously at startup. Once properly booted, type the command fsck at the prompt. Repeat these process until no errors appear.
Disconnect network cables The cause for delay in some instances of this issue may be network related -- as Mac OS X tries unsuccessfully to ping an active connection. Temporarily disconnecting any ethernet cables -- then re-connecting them once Mac OS X has started up -- may resolve the delays.
Uninstall the update An extreme measure is uninstallation of the most recently applied update.
This can be accomplished via the following process; adapted from our tutorial on reverting to a previous iteration of Mac OS X. Note, however, that reverting your system will remove any refinements brought by the update and leave your system open to potential vulnerabilities.
First, make a backup of your current Mac OS X installation with the Security Update applied, problematic as it may be. If there is an issue along the way, your valuable data will be safely intact in its current form.
Next, you'll need to perform an Archive and Install process to remove all of the Security Update's (and potentially problem-causing) components, and replace them with the components of a fresh copy provided by the Mac OS X disc that shipped with your system, or a retail Mac OS X disc. Unfortunately, this means you will lose some system settings and some or all third-party system add-ons.
To begin the process, insert your Mac OS X CD or DVD, as indicated above. Restart your machine and hold down the "C" key to boot from the newly inserted disc. Follow the on-screen instructions, and after accepting the license agreement, click "Options." Select "Archive and Install," and check the "Preserve User and Network Settings" option if you'd like to do so.
After the installation process is complete, you will be left with an earlier Mac OS X system that (hopefully) does not suffer from the problems generated by the Security Update. Use Software Update or Apple's download page to download the update that brings your system to a state directly prior to the Security Update

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