Cannot Format or Assign a Letter to a Seagate Ext. Hard Drive

Hello,

I have just received a new Seagate External Hard drive. I have never had problems with others I have had straight from the box.
When plugging in, the computer recognises the drive as a new device but it doesn't show up in "My Computer".
It does however show in Device Manager/Computer Management in Windows XP as below. It is supposed to work with XP SP3. It is the top drive but with no letter or format showing. It is also listed at the bottom as "Disk 2"

Having looked at various guides, it's suggested either "Assign the drive a letter" or I need to format the drive to NTFS, but as can be seen below, when I right click the top line I get a greyed out options so I cannot do either.

If I right click on the lower "Disk 2" panel I get the same thing...


Therefore I am stumped. I have tried other external hard drives(which all work), updating drivers and changing the USB ports and leads.
I don't want to return the drive yet to be sent another that is exactly the same.

Any help or suggestions would be very appreciated, but please be gentle as I am not an expert:-)

Thank you
G
Edit - I did read somewhere that "GPT" is for hard drives over 2TB and this is supposed to be a 2TB one but in reality it's 1863.02 GB. I don't know if the "GPT" should read something else for sizes under 2TB?