I have ps1 games on an external drive. I do use a powered hub for it but I have it formatted fat32 and I have no issues. They seem to play just fine for me, though I haven’t played a ton of them yet.
My work recently gave me a 1TB usb drive, which I’m now using with my pi. I had originally formatted it as exfat. When I put a bunch of psp .iso files on it, only about 5 showed up in ES. I tried fat32 next, which wasn’t much better. After that I tried ext4, and that works flawlessly. It’s worth mentioning that I was using a USB hub because this USB drive is unpowered.
I have another usb drive permanently connected to my pi, that I believe I have formatted as fat32. That one is not on a usb hub, is powered, but is a lot slower than the ext4 drive in terms of copying roms to the pi via SSH and onto the drives. Copying files the same way to the ext4 drive is much faster. (I found this out by mistake. lol) Since they’re both going over the network and through usb, the only difference I can conclude is the file system on each drive.
^^ my other hobby