resizing partition fails with Gparted when resizing fat32 partition. Ubuntu 14.04

Thanks everyone! I did use Fabby's suggestion and ran chkdsk and there were errors that windows corrected, but it did not solve the issue I had.

I've decided that it could be that the pen drive itself is the source of the problem so I replaced it with another pen drive and repeated the steps (formatting to FAT32, installing a bootable live Ubuntu with persistent, deleting casper-rw file, re-sizing using GParted live CD and creating a new directory names casper-rw).

This time it worked!

This seems to be a bug with the particular version of gparted in Ubuntu 14.04. Repeated failures with resizing fat32 partitions using Ubuntu 14.04 is also reported in this Askubuntu question.

The solution (for me) is quite simple. Use Ubuntu 12.04 or earlier versions either on another machine or from a liveusb. I was able to shrink fat32 partitions on thumb-drives without a problem.

Linux's fschk doesn't reliably fix all FAT errors. If you can lay your hands on a Windows machine, do a chkdsk /f x: where x is the drive letter of the USB on that machine and then resize again.

If you do not have access to a Windows machine, download FreeDOS.