I am guessing here the actual limitation on his drive was done by the Raspberry Pi during partitioning.
Im pretty sure Windows wouldnt just partition the drive and format it without user interaction, and the FAT32 option likely wouldnt have been presented. Also the limitation of FAT32 is explained here
http://technet.microsoft.com/en-us/library/cc938432.aspxQuote:
Maximum volume size - 32 GB (This is due to the Windows 2000 format utility. The maximum volume size that Windows 98 can create is 127.53 GB).
It is the tools that create these limitation that are below the actual technical limits.
It also is not a good idea in many cases to stray outside the limits.
I have formatted a Samsung S2 (usb 2.0)500GB drive to FAT32 using fat32format. Worked fine.