FAT-16 is theoretically fastest because it involves the least seeks (the FAT entries are 2 bytes rather than 4 and the FAT itself is potentially smaller). You're limited to 2gb but so what - a 1gb swapfile is more than enough if you have >256mb RAM. You may have to tinker with the cluster size to get the best performance - the 32K default for 1gb is too big so try 8 or 16K (though the FAT gets bigger).
Make it permanent by setting the MIN and Max values the same - that way it won't fragment.
Resist the temptation to use that old 1gb drive that's sitting in the spares drawer - it'll almost certainly be too slow.
If you have only one controller but plan to use a separate HDD for your swapfile then put it on the secondary IDE channel as master.
With 512mb of RAM the swapfile is used very little and with 1gb hardly ever - it may not be worth all these shenanigans.
So technically the best bet for the average punter with >256MB RAM is a 1gb FAT-16 partition on the primary drive.
Must confess I don't bother......