It's possible for something to lodge itself in the master boot record (MBR) which is a special part of your hard drive, but I doubt that will come to pass. Most malware is very poorly written, and getting something into the MBR requires a fair amount of programming skill.
So, it should be sufficient to just format to get rid of anything lurking. And yes, things can mask themselves from virus scanners. Ironically, they do so using the same basic methods that allow virus scanners to work. Such programs are called rootkits, and generally formatting is the only way to be sure you've gotten rid of one.
Programs like Killdisk are for the paranoid. Since you state you don't have any particular privacy concerns, it would be unnecessary.
I'm just about to do a clean install of XP (Home), in the hope of resolving a drivers issue.
Is there any value in erasing the hard drive with a product like KillDisk, or is it sufficient to let Windows setup reformat the drive?
I don't have any privacy issues regarding my deleted files.
I do wonder whether Windows reformatting would be as effective if there were something nasty lurking on the drive. I DO use antivirus, anti-spyware, & firewall, all of which says the drive is clean. But can there be anything else hidden? And can malware survive a reformat?
Anyway, given that I propose to use a removable external drive to back up my documents for restoration afterwards, and this drive clearly won't be reformatted, would the KillDisk exercise be a waste of time, anyway?