I format in my computer just fine and transfer the cards back to my 1DMarkII with no problems. I have tried your suggested method of formating in camera, however it would be preferable to format on the computer. The reason I would prefer a format is because it is quicker than the offered method of clearing the cards in PM.
I'm not sure if this is a bug, but when PM is deleting the info from the cards, it locks up and I can not continue browsing through my contact sheets until it has finished deleting all the files. This alone makes the option to delete files in the program unattractive. I only mention the formatting option to speed up the hitch in the process.
I love the program. Keep up the great work! Thanks, Daniel