NT is limited to a 7.8G system partition under NTFS; under FAT16 it limited to 4Gig.
The boot-partition (where the OS resides)is also limited to 4Gig - under FAT16 or NTFS... during installation; this can be worked around by formatting the drive in another NT system as NTFS and making it upto 7.8Gig. Formatting a drive as NTFS in another NT system and then installing NT (in its own PC), will allow a max of 7.8Gig for the system (active primary) partition which can contain both boot and system (OS)files...
http://www.win.tue.nl/math/dw/personalpages/aeb/linux/partitions/partition_types-2.html
is a very informative document - with copious links to assorted M$ KB articles - explaining in depth the why's etc...
http://www.mds.mdh.se/~dtv96nkz/cih/partition_tables_properties.htm
is another with much of the same info; but there are differences in the embedded links etc...
It is 'less than wise' to use a drive as a single partition; much wiser to have at 'least' two (preferably more) partitions - one for the OS and one (or more) for data...
You can only 'link' (as you put it...) drives/partitions that are not related to the system and boot-partitions; These areas have to be present for the OS to boot.
Volume sets ('linked' partition etc...) are created from within NT after NT has successfully booted up. Similarly with 'striped sets' - two or more HD's used to store data in various (usually) fault tolerant arrangements... They exist/are accessible only after NT has booted up.
A standard way for NT is to either install it as logical-drive in the extended partition (and then it can be more than 2Gig), with a smallish FAT16 C: system area - where its boot/start-up files will reside; or to install it in the Primary partition upto 4Gig as FAT16 - but better as NTFS and still limited to 4Gig. (more efficient use of disk space). However using NTFS for the system partition does rather limit options when attempting recovery/repair options... And as outlined already, formating the c: system partition as NTFS in another NT syste, does allow a larger (upto 7.8Gig) system partition...
Suggest you read through the link above for much more detailed info...