Hello Macca,
In Windows, it's just that a
MBR (default) formatted disk only supports up to
2TB per single partition. While a
GPT formatted disk supports up to
256TB per single partition. You don't want to have your Windows disk formatted as GPT since it render Windows unbootable.
Looks like it's only up to
32 GB for Xbox, but you could just create a 32GB partition for it to use.
USB Storage Device Support for Xbox 360 - Xbox.com
Hope this helps,

Shawn