I have a similar issue. I have a thumb drive that I've partitioned. One partition is a Know protected, one isn't. I'd like to erase the entire drive and consolidate it into one partition, perhaps making the entire thing a Know drive. But the disk utility app won't allow me to erase the drive because it can't unmount the know partition. Any hints?
Disregard my post above. I found the issue! Can't let Knox open/mount the drive when installing, then you can erase.
I'm glad you got it fixed.
Note that you can create standalone vaults and just put it on the thumb drive, which would effectively do the same thing as formatting it as a Knox drive. However, this would be more comfortable to use as you can deal with the vault file directly such as backing it up, copying it over to other drives, and so on.