Try formatting the drive with another tool. According to MS, the limitation is just governed when formatting from the installer. XP and up should be able to read/write a partition larger than 32GB: http://support.micro....com/kb/314463.
You can try formatting it with Gparted
You could also try dividing the drive into multiple partitions. I came across the same problem with the disk used to store movies, music, books, etc... I ended up getting a super cheap NAS device with Gigabit Ethernet. I formatted the drive in EXT3 (a filesystem the NAS understands) and access the files through sFTP and MS Filesharing. Again, not the ideal solution, since it costs extra money, but its easiest way to share files across multiple OS.
EDIT: for some reason whenever I post a link to the KB article it breaks. So just google kb 314463, it'll be the first hit.
Edited by tekio, 29 December 2010 - 02:49 AM.