I've heard from some people how they use their partition and i'm curious that they install things at such a special way.

Given 3 partitions

they will use
1st parition for os like WinXp etc... using NTFS
2nd partition for installing WinXp applications like photoshop, etc. and data storage for documents etc... using FAT32
3rd partition is for other os like linux.

And they comment that this way of paritioning would save time when formatting windows and skip installing the application all over again. and there's no need for ghosting.

My question is: when any application installs itself to the operating system, it create registry keys in the os and configuration details on the os. After formatting the operating system, it would lose all the registry keys created by the installer and config files are lost. Would it affect the behaviours of the applications without the registry keys and config files?