Debian to USB external HDD!

I've just shoved and 8gig drive in a USB caddy. If I can boot my comp. of USB drives, could I install Linux to it (want to play around:))? Do I need a file system other than NTFS (PTM has a Linux one)? I want this to experiment with at no risk to my XP install. If in XP I delete debian and format the external drive - will XP throw a floppy when I boot and it won't see debian and muck up the boot.ini and if I don't plug in the drive the same?

P.S. You can tell I don't really experiment with dual boot

Main thing:-

I don't want to much up my boot files and end up with an XP installation that's gonna need some recovery console work.

Cheers

I did try and post another thing but them I went BSOD!

Could I live CD ubuntu on the HDD?

Will try

Should be in OS

Well you will need a boot floppy with it as the OS loads USB

So that I could keep it totally seperate I shoved the 8 gig drive into the computer and disconnected the other two and tried to do it that way from an ISO of ubuntu. All I got was a cleared BIOS and and NTLDR problem.

The BIOS was setup properly auto-detected the HD and I told it to boot from CD

So I just installed Windows BLinds instead for longhorn and will try another weekend (going back to school this evening).

BIOS is also doing something that it did before with the power.... restarts with start button or if get windows to switch of compuer. Then one day it just stopped... now started again and BIOS settings are all right.