Compression on a XP system

I am a little confused on what the correct answer would be on an exam due to the following two questions and their respective answers.
You want to reduce the amount of space used on one of your FAT32 drive fast, so you decide to compress a folder named Odata with user data such as Word and Excel docs. When you want to enable compression on the folders properties sheet you notice compression is not available. How can you compress the files with the least amount of administrative effort and still be able to read the files?
Answer(s): c. Create a new Compressed Folder and drag all the files from the Odata folder to the Compressed Folder and delete the original Odata folder
Explanation:
Windows XP contains comes with a new feature named Compressed folders. This feature allows you to create compressed folders which are actually zip files.
--Which of the following is true concerning drive compression in Windows XP Professional?
Answer(s): a. You can compress files and folders only on drives formatted with NTFS.
d. Compressed files and folders cannot be encrypted.
Don't these contradict each other? Am I mis-reading them?
You want to reduce the amount of space used on one of your FAT32 drive fast, so you decide to compress a folder named Odata with user data such as Word and Excel docs. When you want to enable compression on the folders properties sheet you notice compression is not available. How can you compress the files with the least amount of administrative effort and still be able to read the files?
Answer(s): c. Create a new Compressed Folder and drag all the files from the Odata folder to the Compressed Folder and delete the original Odata folder
Explanation:
Windows XP contains comes with a new feature named Compressed folders. This feature allows you to create compressed folders which are actually zip files.
--Which of the following is true concerning drive compression in Windows XP Professional?
Answer(s): a. You can compress files and folders only on drives formatted with NTFS.
d. Compressed files and folders cannot be encrypted.
Don't these contradict each other? Am I mis-reading them?
Comments
Looks like it, cause there's no conflict between the answers. But if you tell me what you think is contradicting, than I might be able to clear it up.
I suggest reading the following first:
Note that Compressed Folders (which are just ZIP files) is an entirely different feature than NTFS compression.
http://www.microsoft.com/resources/documentation/windows/xp/all/proddocs/en-us/ff_file_compress_overview.mspx
second Q
You can only compress files/folders if the drive is NTFS (true)
you cannot encrypt if the files/folders are compressed (cannot remmeber the reason)