im resonably sure that formatting it on another machine will NOT work, as the IDE driver installed with NT4 still has the limitation. go to MS site and search on the problem, and they tell you what file to copy out of the service pack (4) and put on a floppy and stick in at the appropriate time during the install. if i recall correctly, you're still limited to 8G though (don't hold me to that, its been awhile [thank god]).
i did have a problem with this though, if the drive is already partitioned, it sometimes still wont work. however, if your drive is clean, it should work ok, then once its installed you can apply the service pack and have no more problems.
i cant believe they havent distributed a freakin nt4 cd with the service pack already applied, like SQL server 6.5 cds have its sp3 already applied. it's just plain stupid. 🙁