Logical Index Defragmentation at 33%

Hi All,
I was doing my routine maintainece checks and was running index fragmentation check , in one of the databases we have i found the follwoing
1> Primary Clustered Index on two numeric cloumns
2> This Index shows up logical fragmentation level of 33 %
3> The table size is 232KB with 360 rows and Index size is 16KB
This is not cuasing any performance issues but if that table be larger in size would this be problem ?
Also regular techniquies like DBCC Indexdefrag did not do anything , is it because it is primary key ?
Drop and recreate primary key is not option since it would break the relational nature of the underlying schema.
thx

Offcourse Iam refering to Index id = 1 , Iam aware of no improvements if the index was heap.
Any suggestions ??

I would guess that data row maybe narrow and barely any rows, so pages aren't packed yet and the system doesn't correctly delineate the diff between fill & fragmentation. Good to be proactive but thus far too little data to worry about it.

Good articles Satyas already covered it, just wanted to know experinces of people facing these issues.
Anyways there somethings that are left unsaid in the article probably will do few more investigation before I write up, share it with you all and discuss.
Thx
Satish