How to format the OS X installer USB stick that comes with MacBook Air?
Solution 1:
From Apple's MacBook Air: Frequently Asked Questions about Software Reinstall Drive:
Note: The MacBook Air Software Reinstall Drive is read only. You cannot erase it, reformat it, or reuse it as a general purpose USB storage device.
Honestly, thumb drives are dirt cheap these days—why would you want to lose your only way to reinstall your OS?