Alas, no, running ext3 in a loop on FAT32 doesn't magically change your file system access patterns from ext3 access patterns to FAT access patterns. (Eg, in that scenario the FAT would hardly ever change since you allocate a huge file for the loop and then just write within it, versus native FAT32 with it changing with each file change, so the cheap flash drives optimisation for the 4MB holding the FAT would be wasted; and you'd still get random updates frequently in "unexpected" -- by the naive firmware -- locations.)
It appears if you want to run ext3 on a cheap flash drive, you pretty much have to assume that it's going to be slower than advertised (possibly MUCH slower, especially for write), and that there's a very real risk of wearing out some areas of the flash faster than might be expected. Probably okay for a mostly-read workload if you ensure that you turn off atime completely (or every read is also a write!), but not ideal for something with regular writes.
If it's an option for your use case, then sticking with the original FAT file system -- and using it natively -- is probably the least bad option. Certainly that's what I do with all my portable drives that see any kind of regular updates. (It also has the benefit that I don't have to worry about drivers for the file system on any system I might plug it into.)