This issue has been discussed extensively in the past, but I will put in another vote for NTFS. It is the superior system. I use both fat32 and NTFS partitions under win2k on various machines, and NTFS is the system of choice. However, if there are particular reasons for wanting to use fat32 (required to see win2k partition from win9x, for example), then you should be able to use fat32 without any particular problems, win2k will work fine.
The exception is if you are using win2k as a server, in which case you will find NTFS is virtually a requirement. In fact it is required for active directory, which is highly useful if you are running win2k server.