If you can only get one, the FFS1 (TNE) is definitely easier to read. FSS2 (T4 with errata) includes a lot of further development from the fan community. Both include setting-specific techs (HEPLAR, Fusion+), but for the most part are pretty tech compatible with CT -- some tech assumptions do vary, however.
I keep a copy of both for reference. The original T4 FFS text is the most damaged of the two, but as Chris stated, there is comprehesive errata for both editions. The big problem with T4's FFS wasn't the design, so much as the actual assembly of the book, editing, etc. DTRPG has given away free watermark versions of both products before.
For starship design, you might want to look for the QSDS (Quick Ship Design System), which is still floating about the web (and is free!). The last version of this document I have found is version 1.5. This was a greatly simplified version of the T4 FSS ship design sequence, with the most common ship configurations pre-calculated for ease of use. QSDS was very popular for many years among the gearhead competition crowd. (See THUDDD - TML Highly Unofficial Democratic Design Derby.) The full design rules in T4 were often called SSDS (Standard Starship Design System), in case you see that term pop up as well.
There are a bunch a great but increasingly hard to find docs from the late 90's that are still very nice to have today (QSDS, Definitive Sensor Rules, FFS1&2 errata, RP Space Combat, etc.). Lots of broken links out there, but elementary googling and persistance will turn up many fan-written gems on the net. /ponders CotI's fLib
Speaking of which, the original THUDDD site is long gone, anyone know of an archive site containing the submitted designs? Doing T20 conversions of older version ships seems to be pretty popular in these parts -- converting the winning THUDDD designs into T20 versions might be a fun gearhead project...