I have a Windows 8 laptop that i have recently upgraded to Windows 8.1. The laptop has a 500GB HDD and 128GB SSD drives.

Looks like the Windows has been installed on the 500GB HDD instead of 128GB SSD.

I would like to use 128GB SSD for the operating system as it is much faster that the HDD drives.

If i factory restore my laptop, will that give me an option during the process to pick the 128GB SSD for installing Windows 8?

Do i need any Windows 8 DVD for re-storing my laptop/factory re-setting my laptop?

You do not need to do any of those.

here is what you do.

1. Insert the 8.1 Media

2. Double click the install.exe

this will guide you through the process.  The other copy of windows 8.1 will be renamed Windows.old

3. Delete windows.old when you are

Hi,

I you have a recovery partition included in the system , then you can perform a factory reset while you're able to manualy choose a drive where you want to install the system.

I recommend you create a installaton media with your Windows 8 product key, then customize the installation

http://blogs.technet.com/b/canitpro/archive/2014/03/19/windows-8-1-tips-how-to-download-the-windows-8-1-pro-iso.aspx

Regards