File
Allocation
Table, it is a type of file system:
http://en.wikipedia.org/wiki/List_of_file_systems
Basically it is a list of where the files on the cart start and finish, other common ones include NTFS and ext(2/3).
I suggest using FAT, technically it is inferior to FAT32 (FAT32 can use bigger clusters) but you will not really notice the difference.
You can format using the right click on drive format approach although if you want a little bit better performance (reduced slowdowns) then you can use the dos prompt
http://www.microsoft.com/resources/documen...t.mspx?mfr=true
I formatted my cart the other day (in drive I: at the time) using 64K clusters as follows:
format i: /fs:FAT /v

SCARD /a:64K /x
The /x might be unnecessary, what it does is stop the drive and stop any files being accessed at the time from being accessed.
Or you could use the GUI instead (the above way is quicker in my opinion)
Hit start -> run and type compmgmt.msc before hitting enter.
Left hand box, click on disk management, right click your card drive and hit format. Choose options as above.
http://support.microsoft.com/kb/309000