Per M$, if you are upgrading from a FAT32 OS, it's best performance-wise 
to just leave it that way when installing XP:

"If you do choose an upgrade from Windows 2000 or Windows 9x, you may be 
working with a FAT32 file system. Performance will generally be better 
if the file system is left as it is, rather than converted to NTFS. A 
partition converted from FAT32 to NTFS may have to use 512-byte 
clusters, rather than 4096-byte or 8192-byte clusters, which can result 
in a higher number of fragmented files."
http://www.microsoft.com/hwdev/platform/performance/benchmark.asp

Otherwise, to optimize performance, installing NTFS on a clean partition 
would have the edge.  Someone correct me if I'm offbase, but I believe 
the NTFS support in the Linux kernel is still tagged as "experimental", 
and should be considered "read-only" in a dual-boot system.  I've 
dual-booted for years, and I like the convenience of having read/write 
capability across all my partitions, so when I recently installed XP on 
my "MS" partition, I left it FAT32 to avoid any data corruption issues. 
 That way, I can continue to move Word docs over to my much larger Linux 
partitions and convert them to Open Office format...;-)  Another concern 
is not knowing just what additional tweaks M$ may have made to the newer 
NTFS format that would possibly cause problems interchanging data 
between the NTFS and ext3 partitions.  Beyond that, I suppose it boils 
down to how and why *you* are using XP in the first place....e.g., if 
you really need ACL capability, then you'll go NTFS.....


Nathan England wrote:

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>My thoughts as well. But what about performance? Does NTFS 
>under XP provide better performance?
>
>Am Dienstag 23 Juli 2002 06:51 nachmittags/abends schrieb 
>Michelle Lowman:
>
>>I'm sure there is someone here more knowledgeable about
>>this than I am, but if I remember correctly from my MCSE
>>courses, you really don't need NTFS for a typical user. The
>>new NTFS has a lot of security goodies (very fine-grained
>>permissions, etc.), but the average user will probably
>>never use them. And I think that if the user ever decides
>>to dual boot with Linux, he'll have a much easier time
>>trying to write to a FAT32 partition than an NTFS
>>partition.
>>
>>On Tue, 2002-07-23 at 17:43, Nathan England wrote:
>>
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>>>I was building a new machine for a custmer today and they
>>>wanted XP installed. I formatted the drive ahead of time
>>>with fat32, then XP only offered to format NTFS or leave
>>>the partition alone.  So I want anyone's opinion on this.
>>>I heard that NTFS is newer than that used in NT and has
>>>performance modifications. Does anyone know the benefits
>>>of using NTFS with XP home on a typical users machine? 
>>>Or is fat32 still better? Do the security advances
>>>outweigh being able to boot off a floppy and recover
>>>data?
>>>