First, some details –
Are you installing from within Windows (using Wubi)? If not, which install media are you using (LiveCD, LiveUSB, or text-based)? Wubi is unable to install over the entire hard drive, but it doesn't sound like that's what you're using.
There should not be an "Install into Windows" option. Can you provide a picture or at least the exact text of that option?
The three options that should be available to you are "Install Ubuntu alongside Windows," "Erase disk and install Ubuntu," and "Something else." If you want to manually repartition the hard drive, the third option is your way to go. Otherwise, the alongside option ought to do it all for you automatically.