what you said about NTFS is only true for HDDs, but i've talked about flash drives/pen drives
on a side note: i've never had a problem with FAT32 pen drives, i still has a 32MB one since 10+ years now
What is the difference? :O
From what I am aware as much as OS is concerned there is none.
OS will write to a storage drive with either ntfs/fat on a kernel level. File system determines how data is arranged, but how it is written physically is dependant on the controller of the storage engine.
Fuck, you got me all curious now.

If I have time I'll do some research on this and report back.
Got a few myself as well. 32mb, 64mb, 256, 1GB ones.
32mb is without casing so I rather not touch it. I still hold a grudge against the 64mb after it lost my 5 paged exam essay in school and scored me an F with "you need to format this drive before you can use it", I gave 256mb to my mom for backup of her bank certificate and 1GB I think dad is using for pictures.
Btw, you can convert FAT32 to NTFS without formatting.
convert [drive letter]:/fs:ntfs
There will be no data loss. Execute the command and wait for it to finish.
You cannot convert from ntfs to fat32 though. Only way to do that is formatting entire partition.
Edit: here's a nice short article explaining what I was saying above.
http://www.theeldergeek.com/ntfs_or_fat32_file_system.htm
Reliability
FAT32 drives are much more susceptible to disk errors.
NTFS volumes have the ability to recover from errors more readily than similar FAT32 volumes.
Log files are created under NTFS which can be used for automatic file system repairs.
NTFS supports dynamic cluster remapping for bad sectors and prevent them from being used in the future.
Also, comparing the speed of the two.
http://www.msfn.org/board/topic/125116-fat16-vs-fat32-vs-ntfs-speed-on-usb-stick/
FAT32:
Stick prepared for ~21 min. (1253 secs.)
Text mode copy part with USB write-protection- 12:58
Text mode copy part without USB write-protection- 7:15
NTFS:
Stick prepared for ~4 min. (238 secs.)
Text mode copy part with USB write-protection- 1:42
Text mode copy part without USB write-protection- 1:45
NTFS is 5x faster than fat32 in the tests he did.
His test can be biased so test it yourself to verify it.
Taking into consideration that FAT32 does not support file, folder and user permission ( a MUST in network sharing!! ), does not support compression (ntfs can compress files on the fly and thus save disk space), cannot be used for files larger than 4GB and has no quotas (I use this to set how much space my family can use on my HDD's) I'd say NTFS is the way to go.