Memory wipe (Reset) from iPhone 4

I go to Settings>General>Reset> but I don't see the option that says "erase all content and settings". All I see is this home screen layout.

I want to completely wipe my iPhone 4 and start fresh. I tried the DFU mode restore but it didn't work.

Here's my problem.. For some odd reason when I go to the appstore, usually there's an icon that says buy it now or install it for free. I dont see that. So, there's no option for me to purchased it. (Yes I'm connected with my iTunes account and searched all over the app to find the "install" icon)

I tried both. I tried the regular restore and the DFU restore and it did not work. Appstore still doesnt have the install icon. What the hell...

Ol it finally work after restoring it one more time. No this is not the same iPhone 4 I was having issue with the activation. I bought another one from Craigslist last night already activated. So now I have two! I'm planning on selling the other one that is not activated yet but still waiting for the DITS phonebook sim card in the mail. Anyone intrested? Send me a PM.