Yeah, reformatting and stuff is more the way to go for that sort of thing. But I know a few people now who have had issues while/right after installing 7 on a drive they just formatted. It would just seem to be faster to be able to quickly delete the corrupted OS files and start installing again, rather than having to wait for another reformat before trying to install again.
Also, if you decide to switch drives you're running your OS off (perhaps you just got a new SSD to run it from), you could install on the new drive, boot from it, and then remove the OS files from the previous HDD, while still easily keeping all your documents and such.