Please help: Trouble with creating "home" on hardd

I use the Knoppix 3.7 CD to run on a laptop Toshiba Satellite 1905-S303.
I try to create a "/home" directory for user on a harddisk partition FAT32 (created and formatted by Win XP Pro).
I use the tool in menu KNOPPIX/Configuration, choose not to use the whole partition, but only 768 Mb on it.

The tool creates the file knoppix.img, but after it runs to 97%, the computer is turned off immediately. This problem usually happens, but if I try to do the creation about 20 times (each time, I have to boot Linux again after the computer turned off), it will create the "/home" sucessfully.

This trouble happens all the time, and it happens with Kanopix too.
Does anybody have any suggestion about it ?

Have you tried a different size? Don't know if that would make any difference but it's all I can think of...