Well, finally I got the system back to the Factory state and F8 is now working. Even better, I've Windows 8 Developer preview on a separate partition and separate recovery environment happily dual booting. I can now precisely control which OS to load and which recovery environment to boot. Some of the tool I found useful are Windows 7 bootable USB, RMPrepUSB, imagex, Minitools partition wizard, Windows Disk Management utility, Hirens Boot CD, 7-zip, Unstoppable copier and Visual BCD.
If you are also in such a situation, what you want to do is to use imagex in recovery environment, take the Factory.wim in the recovery partition ([Recovery]:\dell\Image\Factory.wim ) and apply it to the C drive. You just need that one file in recovery partition to completely get back to your factory state.
If you need, you can open Factory.wim using 7-zip. You will need to show hidden files and system files to see those files in Windows. If you mount the drive in Windows 7/8, it is not possible to access most of the folders in Recovery partition. (Shows Dell logo and warning )
Learning about these things below helped me on the process
- Hard disk partition structure: MBR, partition table, boot sector
- Windows boot process and tools: boot manager, BCD, bcdedit.exe, bootrec.exe
- Windows Recovery Environment and images: WIM files, ImageX, ReAgen.xml, ReAgetC.exe
It's a too long story to write now, but I would post it sometime for documentation purpose for my future use. I'm planing to make latest OS image and backup to separate partitions and access it by say F5 or something on boot if needed. I mean, I'll still have access to Factory image by F8, but you know, it'll take a few days to install all the updates over updates and your software etc after factory reset to get the system up and running, (if the system was bought several months back). Well, Dell Datasafe will do that if you upgrade the software. But then, where's the fun of learning?