Yes You can format it I have done this before wih a Kinston 4 GB Flash Card But to format The drive to NTFS you need to be using Windows Vista because Windows Xp dosn't support NTFS on removable media which includes flash cards and external HDD's to format to NTFS under Windows Vista Click start>Computer>right click on the hard drive under removable and click format on format propertys under file system click on NTFS then ok the format will take about an hour and half

Im not saying your wrong but im in the process of formatting a 1 TB external drive to NTFS on XP Pro without any troubles as im writting this. Im unaware of this XP problem as i have never seen it before, however if you are able to format your drive you can find out by,

1 - Connect your external drive so that it can be seen in My Computer,
2 - Right Click on it, and from the drop down menu select Format
3 - Follow the steps, Select NTFS from the drop down menu, Rename yor hard drive if you want to and leave everything else as it is, then click Start.
4 - Profit

If you want you can also Right click on My Computer, and from the drop down menu select Manage, then select Disk Management from your options on the left side when the window opens up. You can format your drive from here simply by right clicking on it again and selecting Format.

The OS handles formatting
a new drive recieving a full reformat is rather quick as all it has to do is update teh Allocation table and drive labels.
XP had a thig on it as part of SP2 I believe that updated an existing drive from FAT 16 / 32 to NTFS securely without loosing data. This takes a very long time. So long infact it might be beneficial to back up files on that drive wipe it and reformat at same time and reload.
I run linux and reformatting my file servers Drives WD 1000g Green powers only takes 2 minutes to format to my format of EXT3 or one drive runs NTFS incase i ever go back to windows

I'm using Windows XP.

I tried opening My Computer, right clickling my WD Element 1TB drive and choosing 'Format', but it wouldn't let me.

However, men I right clicked My Computer, chose Manage, Diskmanager, right-clicked and chose 'Format' from here, it worked. Formating right now. :-)