I want to create a VM that is encrypted using TrueCrypt. To do this I create a TrueCrypt volume. I noticed the options are FAT32 or Mac OSX extended. Since I'm planning on installing Windows 7 with VMware Fusion, which should I choose? I've done it using FAT before and Windows seems to be able to install, though I can't have files larger than 4GB and I found some problems changing the disk size through Fusion.
Is it that the TrueCrypt volume may be one file system but VMware adds another layer of abstraction so it's irrelevant? Actually since the .vmwarevm file is much larger than 4GB this could really screw things up. Please advise.