1. NTFS this way you can assign permissions on the external drive. If you are going to be carrying it around alot to different computers with different user logins then make sure everyone has access to the NTFS permissions. Or you can jsut use FAT32 and not worry about it at all.
2. You can use USB 2.0 or Firewire, both work just the same. Your USB2.0 is a little bit faster if you need to know. Plus if you ever want to boot from the external HD you must use USB, unless you can boot from a Firewire device on your Mobo.
FYI, I hope you mean your external HD is 200G and not 200mg.