In the discussions following why Windows setup lays down a new boot sector, some commenters suggested that Windows setup could detect the presence of a non-Windows partition as a sign that the machine onto which the operating system is being installed belongs to a geek. In that way, the typical consumer would be spared from having to deal with a confusing geeky dialog box that they don't know how to answer.
The problem with this plan is that not everybody with a non-Windows partition type is necessarily a geek. Many OEM machines ship with a hard drive split into two partitions, one formatted for Windows and the second a small non-Windows partition to be used during system diagnostics and recovery. The presence of this small non-Windows partition is typically not well-known, and it comes into play only when you boot from the manufacturer's "system recovery CD".
The upshot of this is that if Windows setup took the "anybody with a non-Windows partition must be a geek" approach, it would end up tagging an awful lot of people as geeks who really aren't.
Now, you might say, "Well, only geeks install the operating system anyway. Normal people typically buy a computer with the operating system pre-installed. The fact that they are running Windows setup proves that they're a geek in the first place. Therefore, Windows setup should be optimized for geeks." Indeed, the premise of this argument—that only geeks run Windows setup—is true, but only once you've reached steady state. In the months immediately following the release of a new version of Windows, everybody is installing the operating system, geeks and non-geeks alike. (There is also an influx of non-geek people installing Windows every Christmas.) Magazine reviewers are writing boatloads of articles on the new operating system, and the initial setup experience is the very first thing they notice about Windows. It had better be smooth and painless.