Under My Computer, right click on the C volume, click the tools tab. In the error checking tab, click the "check now" button. Then, check the "Automatically fix file system errors check box. It will prompt you to schedule the error checking upon the next reboot as the drive is locked. During the next reboot, you'll see the error check running during boot.
If you still get the error during the defrag, select the second box "Scan for and attempt recovery of bad sectors" box under the error checking options box, reboot again to let it check, then try again.
The reason I wouldn't check the attempt recovery of bad sectors during the first run is that it takes longer, but you could check it the first time to do a comprehensive check.
There is nothing wrong with your computer, it is an issue with Defraggler v1.08.132.
Not believing Defraggler would have a problem, I tested 18 hard drives in at least 7 computers. DOS prompt Chkdsk and GUI started 'error checking' was run on reboot with same results.
Version 1.07 worked great and the new features being introduced in v1.08 looked very good.
I made a mistake in downloading, then deleting, version 1.07 before v1.08 testing was complete. Now I need v1.07 back... How can I find it so it can be used until v1.08 is fixed?
Neither of the 2 above suggestions worked, so I'm going back to V1.06 (the only other one I've kept) until the problem with V1.08 is fixed - pity about that!