Here's what Microsoft has to say on choosing between FAT, FAT32 and NTFS:
http://www.microsoft.com/windowsxp/home ... _FAT32.asp
Some of the advantages of NTFS are essentially unlimited volume and file sizes (formatting of FAT32 volumes is limited to 32 GByte on XP, and file size is limited to 4 GBytes) and the ability to control access to files and folders. Naturally, the applicability of these to each individual's circumstances varies, but at the very least big volume and file sizes become more and more important as people work with digital video.
I really don't see any merit in creating multiple partitions. You can organize, backup, and restore just as well with folders as you can with partitions. In fact, you can do it more easily with folders. They are more flexible and can be renamed, moved and resized with no effort at all. On the other hand, if you choose to make multiple partitions, then you are stuck with what you chose when you first set up the partitions. You'd better have your psychic abilities tuned up when you pick the number and sizes of your partitions.
I realize there are products that can resize partitions in some circumstances, but the last time I tried one it was limited in its flexibility and couldn't resize/add/delete/split/combine partitions arbitrarily. In any case, even if such a product is now available, why bother? You are just paying extra for something you can do with folders for free.
During the bad old days of innefficient large-disc FAT clusters, there was a valid reason for splitting up large drives into multiple partitions. But that motivation has faded into the past.
Perhaps my thinking is colored by my earlier experiences with unix, where there is one root and everything else spreads out in a tree below it. Drives appear as simple directories, and can be mounted in the overall directory tree wherever one pleases. That is a feature I really like, unlike the bastard-child drive letter appendages. I understand their historical origins, but still feel that they should have been dumped long ago.