The Windows version does a surface scan but likely won't repair bad sectors. If the drive is suffering from bad sectors, there is a chance to repair this using DOS version of WD Diagnostics (Dos version of WinDLG).
The problem is, DOS doesn't have proper USB support.
You also cannot take the drive out of the enclosure and directly connect it to a PC because the WD Passport drive is actually proprietary and part of the enclosure itself and does not have a SATA connection.
I suggest to run your drive's serial number through WDC's Warranty check.
http://support.wdc.com/warranty/warrantystatus.aspx?lang=en
If its still under warranty, try to get it replaced. WD drives depending on the model have 1-5 years warranty.