http://partedmagic.com/
Personally I would use Parted Magic to format your external drive first(or any other partition program).
Make at least three partitons
1) 10 to 15 Gb
2) as much space as you like ( depends on the size of your drive)
3) 512 MB to 2 GB
Partition 1) will be for the ROOT ( / ) partition. Thats where your main linux os files will be.
Partition 2) will be for the HOME (/home) partition this is where all you personal files and folders will be. Remember most modern linux os's have the ability to read and write to windiows partitions so make thios a size to suit your needs. I ususally make mine about 50 Gb.
Partition 3) is for the SWAP partition. Usually twice the size of the ram you have installed up to a max of 2GB. There is a bit of confusion about swap so further reading may give you more info.
Put your GRUB into partition 1).
Thats it really with your drives connected to the pc you should be able to install from your linux CD/DVD.
As to getting rid of your botched install I can not help. May be a good idea to do fresh installs all round.