Because FAT32 is old, slow, has irritating limits, just not the best option anymore. It's now something of the past. ExFAT is superior, fast, no limits atm, it's new, it's best. Nintendo is just stupid that they don't want to pay for the driver so the support for exFat is very bad. Normal Nintendo Switch things can't (easily) corrupt the SD card. So to complain to Nintendo like: make a better driver, my SD got corrupted, etc. They won't respond or take it serious as it only happens to hombrew and I think they're happy about that. There is support for it, it's not recommended and it's noto required for anything and it can be corrupted by using homebrew. Best thing for Nintendo ever. I didn't ever expierenced any corruption at all (only corrupted boot0/1 for using Choi but that's different) so I stick with exFat. Actually it's reversed, people stick with FAT32, they don't switch to exFat. If you can use FAT32, use it, if not, I don't see any bad things about exFat.