|"1 Can xp ntfs read fat 32 ?"|
XP can read data on FAT32 partitions fine.
It doesn't matter that software partitioning type e.g. NTFS - is used on other partitions, as long as Windows recognizes the software partitioning type .
XP won't let you use the FAT32 software partitioning for partitions larger than 32gb because of Microsoft defaults - they think FAT32 partitioning wastes too much drive space for partitions larger than that - but you can use third party software to make a FAT32 partition of any size you like (above 2gb) , XP will recognize the FAT32 partition fine, and FAT32 partitions are not more wasteful of drive space than NTFS ones if most of the files on the partition are huge.
(FAT32 partitions have a 32kb allocation unit size for all partitions exactly 32gb (32,768mb) or larger; the NTFS (versions in 2000 and up) partitions have 4kb allocation units for any size of partition. A file uses a minimum of one allocation unit of drive space per file.You can't use the leftover drive space in the allocation unit, or in the last allocation unit for a larger file, that is not used for data, for any other data. That's wasted drive space, often called slack space.)
"2.Will i be able to back up fat 32 software on my pc"
The data isn't FAT32 - it's data on a FAT32 partition.
It usually doesn't matter at all what type of software partitioning type is used on the partition the data is on, as long as the operating system can recognize the software partitioning type (has to be FAT or FAT32 or NTFS for Windows) .
In rare cases, a program may be optimized for use on NTFS partitions, but that would not apply to the backup software on the FAT32 software partitioned drive.
E.g. The recording feature in Media Center in XP MCE, and in Vista and Windows 7 versions that have Media Center built in, is optimized to be used on a NTFS software partitioned drive, and will display whiny messages if it finds or you specify that video or TV recordings are to be stored on a FAT32 software partitioned drive.
"3. If able to backup the software then do i format the external hd to ntfs and how then do i copy the fat 32 back up software to the ntfs formated hd."
The back up software data is just data on a FAT32 partition.
You probably don't need to change the software partitioning type on the external drive, especially if most of the files you are backing up are huge, in which case FAT32 software partitioning doesn't waste any more drive space than NTFS software partitioning does.
If you insist on using the NTFS on the external drive, if the drive came with the backup software on it, go to the external drive manufacturer's web site - they may have instructions there for how you go about using the NTFS and still using the backup software.
There is only one thing I can think of that might cause you a problem. No one file on a FAT32 partition can be larger than 4gb. E.g. If you download illegally gotten software, some huge movie files may be larger than that.
When you delete a partition on a drive then make a new one, or if the drive has no partitions and you make one, with the operating system, the partition is software partitioned by the operating system one way or another using one type or another of file system organization - e.g. FAT, FAT32, or NTFS for Windows 2000 and up - and then the software partition type is formatted. In 2000 and above, those two things are done concurrently, the software partitioning starting only a little before the formatting, so people often think they're just formatting when they make a new partition.
You can choose to just format an existing partition, but that doesn't change it's software partitioning type.