Hey tesa there are a couple of ways around this,
1. is to upgrade your bios as the other posters are suggesting. However it may not work in all cases.
2. use the installation program that came with the hard drive or if you don't have it (oem drives do not come with it) go to the mfg website and download it, the program is usually called EZ-bios and will fool your bios into letting you use your hard drive to the full capacity.
You question is what will happen if you format only 32mb? From my understanding of how things work it should do the trick, I like Jakespeares solution and it should work as well however I have not heard of it nor tried it.
Here's the reasoning, you bios controls the size of the HD, once you have reached the limit your bios will instruct the hard drive to start writing back at the beginning and overwrite what is there (usually the os is at the beginning), you might get a crash at this point, definitely a crash/no boot/faulty boot at next boot up. So if you only use 32gb or use multiple partitions that should satisfy the bios limitations. Can you use larger sizes than the bios limitation? Sure can! I have but be aware that its just a matter of time until your drive starts filling up and/or is really fragmented then overwriting files at the beginning of the drive is very possible, and its not worth it to take the chance.
Simplest, safest, fastest, easiest, cheapest way to go is with the hard drive installation software.