|This is the acer page with instructions on recovery:|
But I think your problem is the orignal partition configuration has been changed:
(translated from French)
The fellow there has 3 partitions--an EISA configuration partition and a C: and D: drive. The EISA partition is hidden and not to be messed with. The other 2, he believes, were created with partition magic. I'm guessing the recovery disk doesn't know if it should use C: or D: and apparently after giving the 1822 error it reverts to the previous screen with no option to select the partition.
But if you can figure out a way to specify the partition/drive choose C:. If not you may need to remove C: and D: with fdisk or a third party partitioning tool. Make sure you don't delete the EISA partition. Once you remove C: and D: you should be left with unpartitioned space. Try running the recovery again. It should have the ability to set up that space.
If the above doesn't work or you're not sure about it you should probably try to contact acer support.