I am trying to install Linux 12.0 on a Dell 686, Intel Celeron, 512Mb ram. It was previously running PCLinuxOS. The machine has acquired malware described as "keyboard saboteur," and I am not able to proceed. Since the malware is located on the hard drive, I am considering removing the hard drive from the system, and booting from the cd drive. Is this a rational plan?

At first, there is no such thing like "Linux 12.0", I assume that you mean Slackware 12.0.
To your question: No, that doesn't sound like a rational plan. If you want to install Slackware over the old PCLinuxOS install the partition containing the malware will be wiped anyways. Just boot from your install disc and procedd with the installation. When I think about it, how have you thought you will install an OS to a disk that you have removed before the installation?

why do you think this unknown "virus" is installed on a linux computer

the most widely known keyboard saboteur has 4 feet and whiskers and a long tail and likes mice ( real and with a cord )

on a different machine doenload and burn to cd a copy od
"systemrescue-cd"
http://www.sysresccd.org/Main_Page
boot into it
it has a copy of ClamAV and will tell you what is infected - if any

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Thank you for your reply to this question. I am attempting to install Slackware version 12.0, sorry for the error. Last night I opened the computer, and disabled the hard drive by unplugging the power plug. Then I powered up the machine, and successfully booted Slackware12.0 disk 1, using the CD drive, and logged in as root. All of the keyboard keys were working, I checked. Next I turned off the monitor(CRT) and disconnected it from the computer. With the computer still powered up, I opened the case, and reconnected power to the hard drive. With the monitor re-connected and powered up, the keyboard saboteur was back, and only about half the keys were operating. I was not able, "permission denied," to remove the offending directory from the hard drive. Next step is to reconfigure the relative position of the hard drive and the CD drive on the interface cable, so as to make the CD drive master, and the hard drive slave. I will let you know the results.

you know you need to have root permission to edit files outside of your home folder

why not just boot ( with the drive connected) into slack and REMOVE this "unknown" folder
or
boot into "systemrescue-cd"
run clamAV on the drive and find out IF there is a unknown virus called "keyboard saboteur "

however i am betting that you just set the wrong keyboard language code

a french listing will not work on a USA English keyboard

Thank you to all for the helpful replies. I have confirmed that the keyboard was correctly set up for USA. I am now able to boot the computer using the CD drive, and all of the keyboard keys operate correctly. However, in my efforts to eliminate the so-called "keyboard saboteur," I have managed to erase some file on the hard drive (or elsewhere?) with the result that fdisk command "fdisk /dev/hda," results in an error message: "unable to open /dev/hda". Also, the setup window indicates that the hard drive is no longer installed. This is an older machine, so saving the computer is really not the issue. It is clear that I am interacting with security functions, which are not very likely to be supported in readily available "how-to" literature. I may take the computer in for repair, or I may simply buy a new one. Thanks again.