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Formatting Flash drive

reformatting my flash drive and "Restore device defaults" on most all my Flash drives sets the File System to FAT while my systems are NTFS (win7 64)

Will this harm anything leaving the Flash drives in FAT and transferring files from a NTFS machine to FAT then back to NTFS (transferring files from one machine to another *small time stuff*) ?
 
No harm at all. In order to be bootable in some systems, FAT is required.
 
The only downside is the file size limit of around 4GB which is the main reason to instead use exFAT or NTFS but at the loss of device compatibility and bootability as said. Otherwise the format does not really affect the files.
 
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