If you want to make sure no data is available to your purchaser, you need to do a little more than format the drive. This would be relevant if you stored personal information such as credit card numbers, bank details, that type of thing. In this case, you should use a file shedding program, that destroys all your past data.
Formatting alone, does NOT destroy files, it simply makes those files inaccessible to the casual user and that space on the drive, available for further use. However, anyone with knowledge, can recover those files with relative ease.
"Legally you mustn't sell the computer with an operating system (or any other software) installed, unless you also pass on the necessary CD and licence sticker/documents/registration keys"
Would you mind clarifing the above statement for me please? i.e. Would the new owner be entitled to use the operating system and other installed software if he had the necessary CD's,documents keys etc?