VFAT is there for Windows compatability - if you mount the memory card in a Windows PC it will only "see" the first partition which must be formatted with FAT.

To determine which partition you have booted from, check where your root filesystem is mounted from. In the mount command above you have this:

which means you have booted from the second partition on the MMC card (which is formatted with the ext2 filesystem). I can't remember what partition you boot from when booting off internal flash, but it might be something like /dev/mtdblock4 using the jffs2 filesystem.