I would unplug any other HD's before proceeding.
Boot into Windows 7 DVD, press Shift F10 at bootup, or choose Repair my Computer and open a Command Line from Recovery Tools list, then type:
SELECT DISK 0 (confirm this is targeted HD)
Now return to Install Now, use Custom>Drive Tools to Create New partition(s), format before install.
If you cannot boot DVD or proceed from here, then run memtest86 CD test at least 6 passes to test memory, and run full CD scan of your HD repair/diagnostics from here: Hard Drive Diagnostics Tools and Utilities (Storage) - TACKtech Corp.