I guess it's worth noting that MorphOS 1.4 has problems with hard disks over 128GB(?) - basically when you write data to partition beyond that limit, it "wraps around" and ends up corrupting data elsewhere on the drive.

The good news is that this (among few other critical things) got fixed in MorphOS 1.4.3(?) update. So make sure you're using the most recent version before you proceed

(If you want to have Linux on the same drive aswell, you could put that at the end of drive)