The Tiger installer has Disk Utility in the menu. It will format and/or partition drives for you.
I've partitioned a disk to keep video data separate, but I haven't seen the need to do so for Photoshop. The advantage might be that you keep all the "junk" separate and your main disk is less fragmented, but the disadvantage is that you have to decide up front how much space to allocate to a separate partition. Too big and you've needlessly cramped your main disk. Too small and your scratch files won't all fit there. Either way, it probably won't make a big difference in your performance.