Problem install grub

[Jim Byrnes]

Still trying to install Ubuntu 9.10 on a netbook. The install stops at 
95% at grub-install, with a fatal error. At this point the drive was:
|freespace 256MB|sda1 primary ext4| sda5 swap|
I made the freespace into a primary partition and tried to format it 
ext2.  This failed with a message saying there was a short read with 
block 0 bad.

Running badblocks says blocks 0 to 15 are bad.

Then I tried:

ubuntu at ubuntu:~$ sudo mkfs -c -t ext2 /dev/sda3
mke2fs 1.41.9 (22-Aug-2009)
Filesystem label=
OS type: Linux
Block size=1024 (log=0)
Fragment size=1024 (log=0)
66264 inodes, 265040 blocks
13252 blocks (5.00%) reserved for the super user
First data block=1
Maximum filesystem blocks=67633152
33 block groups
8192 blocks per group, 8192 fragments per group
2008 inodes per group
Superblock backups stored on blocks:
	8193, 24577, 40961, 57345, 73729, 204801, 221185

Checking for bad blocks (read-only test): Bad block 0 out of range; ignored.
done
Block 1 in primary superblock/group descriptor area bad.
Blocks 1 through 4 must be good in order to build a filesystem.
Aborting....
ubuntu at ubuntu:~$

Is there anyway to install grub with blocks 0 to 15 being bad?

Just as a point of information if I use the Eeepc recover CD it installs 
and boots up just fine with no mention of badblocks.

Thanks,  Jim