Many external Cardreaders and laptops with internal Cardreaders support only 1Gb Micro SD Card's.
The solution is to update your Driver for the Cardreader to support up to 4Gb Micro SD Cards.
Normally you should find them on the homepage of your Computer/Cardreader brand. Locate the Storage Driver for your Cardreader, download and install the Driver. This should solve your formatting issue.
A good utility for formating Micro SD Cards can be found on HP UTILITY
When formating the card use "FAT" file format.