W2k format gives the floppy an NT disk ID, so when you boot with it control will be turned over to ntldr, not to io.sys. That's why it won't boot DOS, which uses io.sys. With a w2k-formatted floppy, if you copy the w2k boot files to it, it will bring up the w2k boot menu, which will work the same as the boot menu that comes up with your HD boot (except, if you've added the Recovery Console as a boot menu option, it can't boot into the Recovery Console).