I read page 45 of the user manual, then I checked my utilities folder and I don't have a Restore OSX item there. Could it have been deleted when I used migration assistant to move everything over from my MacBook Pro when I first set up my new 2011 MacBook Air? If so, what do I do to get it back without deleting my stuff? Thanks.
In your thread title you are asking about reformatting and restoring the OS. Formatting erases all of your data so if you want to preserve your data then you need to back up your data to an external source like a hard drive, flash media, or optical disc prior to formatting and restoring.