HDD fragmentation

I posted this under memory too on another post of mine, sorry for the double post...

2 nights ago I defragged my computer (it was 50 % fragmented - which is the most i've ever seen, and it had only been 3 days since my last defrag) yesterday I defragged again (18% fragmentation). Obviously there is something wrong with my hdd or Windows XP Pro. Is there something that I might have turned out that constantly writes information to the hdd. I shouldn't be getting this much fragmentation because I've hardly deleted/installed anything.

I guess my problem is just poor preformance and I'm trying to isolate the cause of this problem... anyone else see anything similiar to what I am?
Situation: When I'm running multiple programs or have the game Counter-Strike running but minimized, my mouse skips all of the screen and things take forever to load - I have 512 mb of pc3200 ram, so i doubt that's the problem. I'm running an AMD 2600+ w/ 333 fsb and a ATI Radeon 9800 pro 128 mb, so I doubt either of those are the problem either. I even have problems playing cds/songs when there is a lot running (and by a lot i mean 2-3 programs ie. Internet explorer, mirc, itunes)
btw when I last reformatted I formated in NTFS (previously I was using FAT32). I was told NTFS was more secure, could this be the cause of my problem?
my hdd = Seagate 5200 rpm 2mb cache - but keep in mind before the reformat i didnt see any significant preformance lose because of this.

I'm also using Norton Systemworks Speed Disk to Defrag, I heard this causes problem - not sure how true that is though.