Already I boot with it, as @Mike said I would try to select itself to install and then change to find out the RecoveryThe bootable installer will be like a Recovery Partition, you have Disk Utility there and will be able to format your drive.
You just need to choose "Install macOS Sequoia" to boot from.
After all I have thought that in macos M2 there is a option to reset the system as factory. Maybe this is the option that Apple want you do, no option to downgrade but make a fresh installation without any USB bootable or whatever