We did this subject a good going over a while back.
I use an overwriting program, format it at least twice, remove it from the case and run a big magnet over it a dozen times and then let my kids beat the hell out of it with hammers. Next time I'll also drill a few holes into the drive housing and through the platters/discs/whatchamacallems.
Modified to add - I think the ecologically sound thing to do is to send the rest of it off to be recycled. Lots of nasty stuff (like mercury) living inside the case.