Why do we change the cluster size when formatting USB drives for storing GameCube games?
For loading GC Games with USBLoaderGX via DiosMios/Nintendont, format your usb drive's primary partition as FAT32 with 32KB clusters (also known as blocks). This increases performance by reducing the NUMBER of transactions required to perform a read/write operation at the expense of the (very negligible) LENGTH of time to complete a transaction; since it's reading more data per transaction.
I'm not certain, since I can't find a GameCube disk specification, but I don't think the 32KB cluster size is an attempt to imitate the on-disk storage format of retail GameCube discs; which may or may not be 32KB. Retail Wii discs however, actually DO use 32KB clusters. As far as I can tell, 32KB is simply the highest density of bytes per cluster that is supported by FAT32 and of course, by extension, Wii homebrew storage libraries.
If you're concerned about storage efficiency