Cannot boot: "No init found. Try passing init=bootarg"

After losing power, my machine rebooted to this error:

“error: no init found. Try passing init=bootarg”

Per similar threads on this site and others, I've tried booting from a CD and selecting "Try Ubuntu". Then open a terminal and typing:

sudo fsck-y /dev/sda1.

The response is:

Device or resource busy while trying to open /dev/sda1. Filesystem mounted or opened exclusively by another program?

This is on Ubuntu 10.10.

Any ideas on what I can try next?

Disk Utility from Live CD

1. LiveCD or use a Live USB (your personal preference)
2. Dash -> Disk Utility
3. Mount Volume (try this first, if it mounts skip to #6 otherwise go to #4)
4. Check FileSystem (this will run a check and repair anything it needs to)
5. Mount Volume (second attempt, should work after Filesystem check if it didn't before)
6. Close Disk Utility & Shutdown/Restart your computer.
7. Remove the LiveCD (before shutdown) or the LiveUSB (after shutdown)
8. Restart (may or may not go to GRUB menu, if it does choose the first option).

*Note - steps 4. & 5. are only for if the first Mount Volume attempt fails.

source: http://ubuntuforums.org/archive/index.php/t-1728611.html