Not sure whether I need to partition disk as NTFS when I am always going to be running openSUSE 11.1 with Xen ? Or can I simply have everything as ext3 format?
Your question is not clear. But if you are running SUSE you will not need NTFS. And if you are talking about virtual machines, they do all that for you. Xen is too complicated for me. I use Virtual Box
What I meant is normally I have 100% linux partition, but when running Xen or any other VMWare to install Windows XP and subsequently loading other Windows application softwares within VMware, do I have to make partition from that initial 100% linux ext3 to NTFS or FAT32 partition? Thanks
I suggest you use VirtualBox (either the one included in the openSUSE or from the site VirtualBox).
When you run stuff in VirtualBox (or VMware), a big file is used as the (virtual) harddisk. That file can reside on your current OS (host operating system) and the guest OS (the one installed inside the VM) will see that big file as a harddisk for it. It doesn’t matter the file system on which that file resides.