It is a known fact that formatting your hard disk in NTFS is better and system wise more secure. Also with NTFS you can back up large files, with FAT32 you are limited in many ways.
But this said, my system is formatted in FAT32. I have a hugh movie collection (divx, xvid type) and when I got my new computer, I was afraid that with the NTFS format I wouldn't have been able to play my movies, so I stuck to FAT32.