A diploma program is located in a hospital and leads to the diploma nurse degree (you can be an RN with this in most states). It's usually a 3 year program. But there are not many left. They are a dying breed. It's mostly ADN or BSN now. I think you have alot of options and shouldn't give up:
1. Definitely talk to the prenursing advisor at your school for your chances, and/or a game plan.
2. If it doesn't look like you'll have a good chance with that program, perhaps look at other colleges in your area or even relocating if necessary. Not all colleges have the same criteria. For example I just applied to 3 colleges and 4 different programs. One school I have a 3.4GPA, another I have a 3.33, and at another a 2.54! It's all in the classes they look at. One of those schools also has academic forgiveness. Which means if you retake the class you failed then the new grade is plugged in for the old grade and hocus pocus you now have a much better GPA.
3. Consider becoming an LPN first, then completing a bridge program to RN. Alot of LPN to RN programs are more flexible when it comes to your previous college work. Of course you'll have to retake the classes, but it might not affect your chances of getting into an LPN to RN program so much.
4. OH, and DON'T GIVE UP!!!!!