It must be either the BIOS or the diskette who is guilty. And it can be the security issue. It is possible that your (special) BIOS allows setting it to diskette as a primary boot device but the setting is ignored in the end. It can be the program on the diskette, which - once it gets control - performs a warm reboot from the HD. I can propose the following:
(1) First check whether you can boot from a diskette at all. A lot of bootable floppies and CDs can be found at
http://bootdisk.com Download, for example, DOS 5, create a bootable floppy and try. You will need a winblows machine at hand, the boot images are packed as winblows apps.
If you succeed with DOS 5 diskette then you are done. The diskette contains FDISK, which is able to delete any partition in the HD, no matter which FS the partition contains. Ignore senseless partition sizes (DOS 5 is rather diluvial now

) and go on deleting. The HD gets cleansed correctly even if the partition data will not be recognized okay.
If you can boot from a CD then there is gParted ISO. For example,
http://www.icewalkers.com/Linux/Software/526550/GParted-livecd.html It's a linux FDISK, which is able to delete HD partitions as well.