I have to go to windows explorer to open it. In properties the stick says FAT 32. Normal unformated out of the box sticks say FAT.
Unformatted... it says FAT? Could you save anything on it, or did Windows tell you it's unformatted and that you had to format it?
Here's my understanding of what's going on. If the USB stick is unformatted, Windows is guessing it's a FAT (FAT16) file system. Windows no longer uses FAT16. That's why you don't have that option. FAT32 came out with Win2000 and NTFS came out with WinNT. NTFS is the current file system.
I'm guessing your confused about why you have to open Windows Explorer to access the USB stick? That's because the stick acts like an external hard drive.
If you have to format it before you can use it, select NTFS. Just because Windows is stupid by telling you it's a FAT file system doesn't mean you should listen to it.
I hope this helps.