So, If I make my new 160Gig partition NTFS (XP), will I still be able to move files back and forth between that drive and my laptop FAT32 drive which is on the network?
In fact, if your OS is XP, you can even see FAT32 partitions on the same drive, I believe. It's only win9x and below that can't see NTFS partitions on the same PC. But over a network, it makes no difference at all.