I think that the terminology might be confusing things here.
There's no such thing as a "FAT32 hard drive". That's really shorthand for saying "A HD with a partition that is formatted as a FAT32 file system".
Once you pull this apart, you'll see that in order to get to the "NTFS" part of your request, you need to have a partition to format with that file system.
The "normal" way of getting to that is by creating a new partition on the hard disk; tools like Partition Magic will let you resize your existing partition (the one formatted FAT), letting you create a new partition in the freed-up space, which you can then format as you like.
An alternative way to get a new partition is to create one that's visible through a separate driver like TrueCrypt's. TC can look at a "real" partition as I described above, or it can handle a "virtual" partition that exists within a file stored within another filesystem. But in this latter case, the TC file must, of course, conform to the rules of the file system that contains it. And that means that you're stuck with 4GB on FAT32.