OK well you formatted the system but so your issue is resolved. But the answer to the problem has to do with the MSDOS versions you are running. Was the system upgraded froma previous version of windows. Also, are you booting the system from a boot disk. the COMMAND.COM the starts the DOS prompt has versions. You can not mix and match them between version. Mostly one of the original files of your system got changed to a previous version and now at the prompt you are getting MS-DOS is the wrong version. I have seen the before and the only way around it is to either boot the system from a floppy that is created in one version. You can not copy one version file to a different version boot disk or you will get this error.

Been there, Done This, Bought the T-shirt. I think the first time I encountered the I formatted the drive. Since we where doing a lot of support on many many system data lost wasn't an option so we needed to resolve....