My mac boots to a grey screen - target disk mode works
Boot to Single User Mode (Cmd S) let it do it's thing and then type: 
cd /var/log
(press enter)
grep disk0 * 
(press enter). 

Towards the end of the outputted logs if you se IO Error your hard drive or flex cable are going. 

If you can boot in safe mode (holding down shift at start up) maybe you have a dodgy 3rd party kernel extension.