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Slydude

 
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Member Since: Nov 15, 2009
Location: North Louisiana, USA
Posts: 6,420
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Mac Specs: 2.8 GHz MacBook Pro 10.8,3 8 GB mem, 2.66 GHz Mac Pro - Dead, iPhone 4

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I think what is happening is that the drive has not been formatted yet therefore it is not being recognized by the restore routine. Are you booting from the external drive that you mentioned or a Lion recovery partition? If so, you should be able to format the new drive then finish the recovery process.

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