Recover hard drive accidentally reformatted from NTFS to Ext4

So me and my friend were installing Arch Linux on my external hard drive. My external hard drive had no data on it, ready to roll. My friend had partitioned my external hard drive (I am positive that there was no error in this part of the process), but after he had exited out of cfdisk, he had accidentally typed

mkfs.ext4 /dev/sda2     # my *internal* hard drive

instead of

mkfs.ext4 /dev/sdc2     # the drive he was supposed to format

I asked, "Hey, isn't my external hard drive sdc, not sda?"

Then he starts freaking out, and he shut down the Arch Live CD and tried to reboot into Windows (on my internal hard drive). This screen came up:

Windows Boot Manager  

Windows failed to start. A recent hardware or software change might be the cause.  
To fix the problem:

  1. Insert your Windows installation disc and restart your computer. 
  2.Lo and behold, t Choose your language settings, and then click "Next."
  3. Click "repair your computer."

If you don't have this disc, contact your system administrator or computer
manufacturer for assistance. 

  Status: 0xc000000f

  Info: The boot selection failed because a required device is inaccessible.

I immediately held the power button until it turned off, and haven't turned it on since, in fear of doing something worse to my computer.

My questions:

1. Is my C: partition wiped, or is it just my boot partition? I suspect it was the C: drive…
2. I want to create a full binary backup of my (former) C: drive before I perform any rescue attempt, so I can do more than 1 attempt to recover my data. Is this even possible, and can I actually use this to actually do multiple rescue attempts?
3. There are 2 major things I want to recover. One of these is my Compositions folder, which is in the C:/Users/MyName/Libraries/Documents/Compositions folder. These files have a weird extension (.mscz), which I doubt certain file extension-sensitive data recovery tools can find. Can some tools find files with unknown extensions?
4. Do files in lower directories have a higher chance of being saved? Because my most important stuff is held in C:/Stuff.
5. I would prefer that the software recovery tool would be free.
6. I had deleted the HP RECOVERY partition a while ago, stupid me. However, I have quite a few Windows 7 System Restores that were fairly recent. Are these on the C: drive? If not, can I use these to reinstall Windows 7 after my data is (hopefully) recovered?
7. I have a set of HP recovery disks, if those are of any help.

Specs and other information:

My computer is an HP laptop with Windows 7 64-bit (single boot) a 750GB hard drive (~200 GB unused, 6% fragmented last time I checked. I only need to recover around 2GB of data; the rest I can easily replace). My friend has a fully functioning computer, and I have an external hard drive (1TB) that I can use in the recovery procedure. We both have a couple of USBs that we can use as Live USBs.

1. Windows doesn't use a separate boot partition, so it probably is C:. It isn't exactly wiped, though - it's just that the filesystem metadata has been overwritten. Most of the contents of the files are probably still there, but inaccessible.

2. Yes, it's possible and it's a good idea. If it's a 750 GB drive, though, keep in mind that the image will be 750 GB. You'll need a lot of space to do this. Run dd if=/dev/sda of=<output_filename> bs=16M (the block size doesn't matter that much, except that it should be a multiple of the disk sector size - I've seen it suggested that it should be set equal to the size of your drive's cache). This will produce a binary copy of exactly what's on the drive. You can, with a bit of fiddling, generate a VMware or VirtualBox image from that, which you can run recovery tools on.

3. The extension matters not at all. Some file-recovery programs work on certain file types by detecting the structure of the file itself (or maybe just magic numbers in the headers) - obviously if the program isn't written to recognize a certain file type, it won't work regardless of the extension.

4. This is unlikely to make any difference.

5. Try TestDisk.

6. The System Restore points may or may not be intact, but you won't be able to recover a full OS installation from those. You'll probably have to find actual installation media.

7. These might allow you to to restore the OS, or they might not (recent recovery disks tend to only be helpful in recovering drivers and whatever bloatware the manufacturer installed). In any event, don't try to use them until you've recovered all the data you can.