This error can occur in two different stages of the GRUB configuration….
1. Either during the initial configuration
2. After booting the system and attempting to launch Linux (and the 2nd thing u had)
try out the followings !
1. Boot the system from Linux installation cd/dvd
2. Mount root partition
3. chroot into the system
4. If kernel image is missing, copy it from disc to boot partition (like cd/boot)
5. Make sure that kernel name should match with that in grub.conf file
6. It is necessary that BIOS is properly configured to detect the disk on which kernel resides
7. Reboot the system
Remember, make sure for it uses correct setup & root lines
Use grub -install command to reinstall the same.
NOTES: If the above fails, check the boot partition by using fsck command. If fsck can not correct the error, go for reinstall process. Before doing that take data as backup. If any reason u find it impossible to restore from backup, need to use data recovery tool for Linux. There r several free tool to overcome the problems. Or set the HDD as a slave disk onto another computer (Linux/Windows) and take backup.