That sounds like the problem then.
If you are using win95/98/ME, you will have to either 'upgrade' to Win 2000/XP, or split the AVI and record it in two halves. I say 'upgrade' as it would be best to do a clean install. FAT 32 is faster on <60Gb partitons, NTFS faster on >60Gb.
If you are using Win 2000/XP, you could convert your filesystem to NTFS, though I would not advise this. You may end up with 512B clusters and that will cripple your performance.
I use PartitionMagic...get a copy and create an NTFS partition and direct NVE to use it as its temporary files folder.
PartitionMagic can, in theory, change NTFS cluster sizes, but I would not like to rely on it. It's good as a partitioning tool, but some of its other functions have not worked for me. Other software will do this too, the name of it I forget.