Yes, those are referred to as "floppy drive emulators" – which might sound a bit strange, but that's what they do. There have been numerous threads about them already.

If we use, say, 32 GB compact flash, would the computer see it as 32 GB floppy without problem? If that's the case, who needs hard drive anyway? You can alternate boot the same retro PC with various OS from DOS to Win95 to Win98, and you don't even need a hard drive, because the games are already installed in that particular CF anyway. For example, you could have one DOS-bootable CF with DOS games like Blood and F-22 Lightning II, then you also have another Windows 95-bootable CF with Win95 games like Sabre Ace and Hind, etcetera. No need to format the retro PC's hard drive for dual boot (for example, DOS/Win98), because all you need to do is to swap floppy.... I mean CF.

Kreshna Aryaguna Nurzaman wrote:

If we use, say, 32 GB compact flash, would the computer see it as 32 GB floppy without problem?

Oh hell no. The OS and BIOS would throw a fit. If I'm not mistaken, these devices generally load standard floppy images stored on the card, one-by-one, and you can toggle between them using buttons on the device.

There are of course CF-to-IDE adapters, and you can swap CF cards out of those one by one. Lots of threads about those, too.

yawetaG wrote:

I can see this as being very useful in retro computers.

Look for threads that contains the words Gotek or HxC. They are the most popular FDD emulators.

Kreshna Aryaguna Nurzaman wrote:

If we use, say, 32 GB compact flash, would the computer see it as 32 GB floppy without problem? If that's the case, who needs hard drive anyway?

As Jorpho said, no. Those floppy emulators use the card to store disk images and change between that. For HDD substitutes look for XT-IDE or XT-CF (if your computer is an XT without IDE controller) or IDE-SD or IDE-CF adapters.

Although the PC and BIOS calls of PC allows room for bigger floppy disk formats (i.e.: it would be easy to trick the FDC into reading 127 sectors/track), keep in mind that the FDC can not receive the data any faster. Although you could use/emulate a 32 Mb "floppy", it would be read at 500 kilobits/s (minus overheads, that's the FDC bus speed) so it would be painfully slow.