Time Machine Prompt for Erase
Ok, I thought this important enough to check out for myself. For the OP, know I'm not trying to argue the point or "rub it in" that you might have "clicked through", I just wanted to post the fact there is a warning before erasing any drive - so others won't be worried about accidentally erasing a drive.
Anyway, the upshot is OS-X definitely prompts the user prior to erasing the drive. I setup the same scenario as you had, i.e. a Windows (FAT32 in this case) partition and an install of OS-X which hadn't previously used Time Machine.
The first thing it prompts is "Do you want to use "BIG FAT" to back up with Time Machine?" (sorry 'bout the name - it's FAT32 and it's big 😉.
Next, upon clicking "Use as Backup Disk", it will enter Time Machine Preferences with the following warning: "Are you sure you want to erase the backup disk "BIG FAT"? Erasing will destroy all information on the disk and can't be undone." The default button is "Don't Erase".
I wish I had an explanation for what happened in your case. I can certainly understand the painful situation and hope you can get your data recovered easily.
(attached🙂