Should I format the drive on the PC first with the drive diagnostics to low level the drive, then format it with Mac OS X?
No.
Disk utility has an option for writing the disk with zero's. Is this the same as low leveling on a PC?
No it's not the same thing, but it will be fine for what you're trying to accomplish, and far healthier for your drive than a low level format.
Low level formats are a hold-over from ancient times. On modern drives, it's actually a
bad idea. The reason is rather technical, but the short version is this: A low level format will move all the existing sector start and end tags, which means all sectors will be moved to new physical locations on the disc surface. Due to the nature of the magnetic media, every time this is done, the likelihood of disk read or write errors increases (because the old information isn't erased, and the magnetic "noise" on the disk is increased). And somewhat counterintuitively (at least at first), it actually makes it
easier (for the professionals) to recover what was previously stored on the disk.
Low level formatting used to be used to "eliminate" bad sectors. Later, drives began using spare blocks to solve the bad sector problem.
To me, short of shredding and melting the actual disk platter, someone wil be able to recover data... Th US Gvt recommends 7 passes minium of rewrite to render data unrecoverable...
And the DOD
only shreds decommissioned drives which have ever held, or may have held, secret info.
I don't think there are any apps so far on OSX that can accomplish this easily.
iWipe?