DOS 3.3 came with, if memory serves, the BASICA.COM basic interpreter. This is a 16-bit program and will not run on 64-bit Windows 7. You will need to either use Virtualization Software such as what Soybean suggested or XP Mode, which to my understanding is just a XP virtual machine as well.
(On another note, The problem has nothing to do with FAT16)
Either way, I would strongly encourage you to make sure any necessary BASIC source files are saved as ASCII text, rather than the native binary format the interpreter normally saves.