tried the droid way, 'hold X and power' but isn't working for me.
is the milestone different?
EDIT found this on a german site.
The hard reset in Motorola Milestone Step by Step
1. Turns off the device, just take out the battery and puts them on again.
2. Pressing the camera button and hold it pressed while you turn on the device. Hold the camera button pressed for so long, until the display shows the Motorola logo appears. Then the power button let go and hold the camera key pressed continue until you see a triangle with exclamation point.
3. Now the camera and presses the volume up button at the same time to bring up a menu. (Might need a few attempts)
4. With the volume button you now select "Wipe all user data" and confirmed it with the OK button
5. Then you confirm the security prompt again with the OK button
6. The reset goes through and you must confirm the restart after