If you have 120GB partitions, they're not FAT32.
I must be imagining things then. XD
(note: Fine, so it's not 120 GB; that was my friend's computer, not mine.
But it's still more than 32 GB; you get the picture. =P )
Actually, with D3v1L80Y's links and a little bit of Wikipedia-ing, I got it.
Windows 2000 and Windows XP can read and write to FAT32 filesystems of any size, but the format program on these platforms can only create FAT32 filesystems up to 32 GiB. Third party utilities are available which can format larger FAT32 filesystems. Thompson and Thompson (2003) write that “Bizarrely, Microsoft states that this behavior is by design.” A Microsoft knowledge base article indeed confirms the limitation and the "by design" statement, but gives no rationale or explanation. However, a Microsoft TechNet article states that the 32 GiB limit was an arbitrary limit imposed because many tasks on a very large FAT32 filesystem become slow and inefficient. Peter Norton's opinion is that “Microsoft has intentionally crippled the FAT32 file system.”
At some point you have to say, "Enough is enough." After considerable discussion, 32GB was decided upon as the arbitrary cutoff point. Windows 2000 and higher offer only NTFS when formatting larger drives. Note, however, that Windows 2000 and higher will use a FAT32 drive larger than 32GB; they simply won’t create one. (For a 32GB FAT32 drive, it takes 4 megabytes of disk I/O to compute the amount of free space.)
Sigh... maybe in 1995, this was understandable, but I think computers in 2007 would be able to handle HDs *gasp* larger than 32 GB just fine. That's a huge lack of foresight on the part of MS...