You have to remove the device from the machine. Many/most "factory restore" disks won't run if the hardware is different from when the machine left the factory. Modems, video cards, USB cards, etc, etc. Any different hardware.

Once you've done the above....

As far as clearing the hard disk, you could;

First, boot to the Windows XP recovery console. Description of the Windows XP Recovery Console for advanced users (See Option 2 or 3)

(This is not a required step, just make sure you have the correct hard disk if there is more than one hard disk in the machine.)

Inside the recovery console, type the command:

Map

and hit ENTER.

This will show what drives are on the system. The primary drive always starts as Disk 0, then Disk 1, and so on. You can also use diskpart to see what drives are on the system.

When ready, type:

mkdiskraw #
(# is the number of the drive you want to clear)

Hit ENTER.

This command will nuke your data, filesystem, partition table, and MBR all in one move.

After you've done this, start the factory restore on the blank hard disk.

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