I think the question is, what might have happened to the partition table on your second disk.
First of all, if you enter the BIOS setup program, can you still see both HD's? This is critical, if it is gone there, it is probably a hardware failure. I think you should be able to see both.
How was X drive formatted? What file system?
There are a lot of things for you to understand to install a dual boot system, it can be done, but you do not format the space first. Almost every distro has a partitioning and formatting programs included. Linux uses different file systems windoze can not read. ext2 is a standard linux file system. The program you mention will read a ext2 file system, but not one formatted by windoze. So, what file system did you put on Z??? ( in linux it would be more like hdb5 ).
Grub - Grand Universal Boot Loader. Usually it gets installed to the MBR on the boot disk during a linux install, near the end of the install process, so I dought it ever got installed. "Fixing XP" probably restored the MBR to a standard winbloze boot loader. That is good for now.
How to retrieve your data... If it were me, I dig out a bootable live linux CD such as Knoppix. Boot the system from the CD-rom drive, mount the disks, set up what ever networking I need and copy the data. Linux will read fat32 and NTFS partitions, and any linux partitions.
This is what I would recommend you try to retrieve your data. Don't get into panic mode, it will take some learning to do what I outlined, so first things first. Download Knoppix, I suggest it because there are a lot of people using it, and you can get lots of help. Burn the .iso image, you can find instructions on this board on how to... Please locate the instructions, and follow them. I'm assuming you have a CD burner. If not, could you get a friend to help?
You may have to enter your BIOS to set the CD drive as a bootable device. Set your system to boot from the CD ahead of the HD.
Boot Knoppix. Post back for more help...