what kind of machine is this running on? I've read that some older motherboards do not recognise patitions(?) over 2GB. So, maybe thats the problem. I'm not too sure about that, as i havent experienced it myself.
One thing you could do is install Powerquest Partitionmagic, which is really helpful if you are not too sure about partioning and stuff like that. It shows the drives unformatted space as well.
I guess thats my 2 bits worth.....