Linux on FAT32 or NTFS

(Using 2.6x kernel with UMSDOS dropped.)

The possibility to have a single file on any uncommon filesystem for Linux (such as FAT32 or NTFS) and to use this file as an image containing all the filesystem is old, called loopback and famous in Wubi (Ubuntu Installer running on Windows and not needing to change anything even if there is only a single NTFS partition).

I am interested just out of curiosity whenever it is possible to install Linux (in meaning of a full distribution such as Ubuntu) from FAT32 and even more NTFS. There is yet not much sense behind beside exploring what is already technical possible and what not.

grub4dos can start from NTFS and can be even started from Windows boot menu, this makes it even more interesting, even it can be used as a drop in replacement for grub legacy.

In comparison to Windows XP it seams Linux is much less picky about changed hardware. The connector of the boot device (IDE, SATA, USB) can be changed without complaints and even booting on complete other hardware with a portable device I did never run into stupid bluescreens. (using generic kernel without proprietary/special hardware drivers etc.) So I dare Linux also to flip the underlying filesystem.

Right now I haven't found a tool to convert ext3 to FAT32 or NTFS and all distribution installers I've seen do not allow to install to those filesystems (not talking about loopbback...).

So I did try to copy the content of the ext3 partition to FAT32 with nautilus as root but refused due to "can not create symbolic link".

If it is possible to archive to get Linux 2.6x running directly from FAT32 or NTFS, how?