If you want to get rid of all the music on the hard drive, select the hard drive and while it is playing, press the big round Menu button, then select 'All Songs', then press the Del button and it asks you to confirm if you want to delete All Songs.
You may have to delete the paired Bluetooth devices and Contact List separately as I'm not sure that 'Restore Factory Settings' will do that. Problem is that the infotainment handbook doesn't really align with the infotainment systems in our cars.