When there is just 7 users, i'll recommend go for new domain installation & since you are going for windows 2008,go for for win2k8 R2.
AD can't work w/o dns & i don't know how your domain is running w/o dns,so install from scratch & it will be better for further management.
Why i'm saying for new installation,because i think OS may required to repair & again database has to be restored & may be other error comes up,so go for new installation.