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I'm not sure about that. But when you buy a new computer with XP on it, the hard drive is formatted with the NTFS so I know that XP doesn't have problems in general with NTFS. Upgrading or converting may be a different matter. I've never done it before, I just noticed that Partition Magic does it when I used it to split a partition on my laptop.
Unfortunately, I don't know of any other way to handle large file sizes other than NTFS.
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