I have not used PM ver 8, but I have made extensive use of ver 6 and 7.
In order to make a partition, you have to have disk space that is not part of a current partition. Most windows installs, assuming it was installed when you got the machine have one partition owning the entire disk. So, your first step is to resize the windows partition (smaller). If you want, say 10 gigs of space for Linux, shrink C by that much. (back up any critical data first). Make the space after the windows partition.
You should then be able to partition the empty space. Depending which distro of Linux you plan to install, some of the distros have very nice graphical disk tools that can be run from the install CD. You can do the linux partitioning, and file system installation with Linux.
I know older versions of PM also can do the Linux partitioning.