It irks me somewhat that various NAS vendors are currently scrambling to support Mac OS X Lion’s implementation of Time Machine. Long story short, it requires that the device providing a network resource to act as a Time Machine volume supports DHX2 authentication.
So far, it would appear that LaCie, Western Digital, Iomega, Synology et al have completely failed to produce a DHX2-authenticated NAS even though the various Lion developer previews have been around for ages now.
What’s more, this hasn’t stopped the very excellent Netatalk project from supporting DHX2. Admittedly it’s still in beta, but at least it’s there and it does work. As my local file server / satellite recorder / general dogsbody machine is running Gentoo Linux, compiling and installing the latest beta is trivial and fixes all of the problems, allowing my iMac to continue to use it as a Time Machine volume.
For those interested, a very comprehensive howto for installing the Netatalk beta is available here.