Let me get this straight: you typed "tohd=/dev/hdxx" at the KNOPPIX splash screen, and next thing you knew your HD was trashed?

As far as I know, when you type tohd, all that happens is that about 700MB of stuff gets copied from the CD to a directory called knoppix in the top level of the partition you indicate. And if there isn't enough room or it doesn't accept the partition's type of format, it doesn't copy anything. In that sense, I've used it a lot precisely because it has always been extremely "low impact" for me -- from the windows perspective, no more than "just another folder" in my root directory.

So I am curious what other details you noticed. Like:
Did the drive have an unusual configuration? Was it NTFS? Is it possible the drive was "hanging by a thread" to start with?