NTFS Partition Compatible with Win 98 fat 32 on a

Correct. When installing XP chose not to upgrade the drive to NTFS and you won't have any file system conflict issues!

"Opinions are like assholes, everyone has one"

thats strange that it doesn't give the FAT32 option. Worse comes to worse, you can boot off a win98 boot diskette (you can grab one from <A HREF="http://www.bootdisk.com" target="_new"><font color=red>bootdisk.com</font color=red></A> if you don't have one), fdisk and format, then boot off the CD and tell it to use the current partition as is.

<i>It's always the one thing you never suspected.</i>

Yes, I am in agreement with jlanka.
Use Windows 98 CD (if you have otherwise download a boot disk from the link jlanka provided). Format the hard drive using Win98 CD/Boot disk. It will format the partition under FAT32.
Finally run the Windows XP setup.

<font color=blue>Mubashar</font color=blue>
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<b><font color=red><i>"All delays are dangerous in war."</b></font color=red></i>

you should be able to format to fat32 from the winxp boot cd. i dont know why it isnt showing up for you, but, you should be able to do it like the other guys have said above.

as for your actual question, here's my educated guess...

i say educated cuz i have just switched over to xp within the last month and haven't actually used winxp on a network yet to encounter the problems. but, despite this, i have been learning how to use this new os and i think winxp does allow win98 machines to access shares created on it.

from my understanding, ntfs is like fat32, except that it reserves a cluster in each sector for special system flags that allows u to control the security of your file system by setting permissions on files and folders. These permissions control which users have access to those files and what types of access they have, such as "read, read & execute, write, modify, etc."

WinXp is very much a "user" system, in that, you can create multiple "user accounts" and "user groups" and assign rights and priviledges to them. It is possible to create user accounts for people to remotely log on to your computer. By setting the permissions on folders and files for these users accounts, you should be able to control which files and folders they have access to under that user name. I believe it is possible to therefore allow a win98 machine to access the winxp machine by setting the permissions on a folder or file to include "read, write ..." permissions for the "computer name" of the win98 machine. These settings can be made from an administrator account on the winxp machine by right-clicking the folder or file, selecting the "sharing" tab, "share this folder" button, and then the "permissions" button. In the window that comes up, there should be an "add" button that allows you to add a user or group so that their permissions can be defined. I believe the easiest way to set it up for more than one computer is to just "add" the "network" group, and then configure the permissions. This should give any network computers the ability to access those drives, folders, and files that you have configured as above.

However, for many people, this may be too much trouble if tight security isnt a concern, and in that case, fat32 would be a better option