Thorby,
Just for completeness, does the .hdd file that you're creating itself reside on a non-FAT32 partition (i.e., MacOS Extended, etc.)? The issue that palter was suggesting was not that filesystem inside the VM needed to be formatted as NTFS, but rather that the filesystem the .hdd file itself resided upon shouldn't be FAT32 (for the reason that was specified).
Edit: aah - and I just saw palter's answer to the above as well. So... what he said.
Last edited: Oct 22, 2006