Making Time Machine work with the ReadyNAS

I just got a ReadyNAS NV+ and I'm trying to get it to work with Time Machine. I'm following the "golden" instructions (http://www.readynas.com/?p=253) , and I almost have it working in that Time Machine recognizes the sparsebundle I created. It seems to work until it calculates the size of the backup and decides that my sparsebundle doesn't have enough space. The problem seems to be with hdiutil, but I was wondering if anyone could help me out.

I did some experiments creating sparse bundles. If I create a sparsebundle on my local disk, mount it, and then get info on the mounted volume, I find that the capacity is what I set it to, but only 14GB is available and the rest of the space is "Used". Used for what, I have no idea. Both the Finder and df report that only 14GB is available. Is there some trick to this? Here's my latest shot at it:

hdiutil create -size 500g -fs HFS+J -volname "Backup of G5" g5desktop_001451634a5f.sparsebundle
... mount with finder ...

df -h /Volumes/Backup\ of\ G5/
Filesystem Size Used Avail Capacity Mounted on
/dev/disk2s2 500Gi 486Gi 14Gi 98% /Volumes/Backup of G5

I scouted around on various threads for a few more options but got the same result:

diutil create -megabytes 500000 -fs HFS+J -verbose -nospotlight -volname "Test1" -type SPARSEBUNDLE -layout SPUD -imagekey sparse-band-size=131072 foo.sparsebundle
Initializing…
Creating…
DIDiskImageCreatorProbe: interface 4, score -1000, CWOUDIFDiskImage
DIDiskImageCreatorProbe: interface 5, score -1000, CRawDiskImage
DIDiskImageCreatorProbe: interface 7, score -1000, CSparseDiskImage
DIDiskImageCreatorProbe: interface 8, score 1000, CSparseBundleDiskImage
DIDiskImageCreatorProbe: interface 9, score -1000, CCFPlugInDiskImage
DIDiskImageCreatorProbe: selecting CSparseBundleDiskImage
DIDiskImageCreateWithCFURL: CSparseBundleDiskImage
DIBackingStoreCreatorProbe: interface 0, score 100, CBSDBackingStore
DIBackingStoreCreatorProbe: interface 1, score 1000, CBundleBackingStore
DIBackingStoreCreatorProbe: interface 2, score 0, CRAMBackingStore
DIBackingStoreCreatorProbe: interface 3, score 100, CCarbonBackingStore
DIBackingStoreCreatorProbe: interface 5, score -100, CCURLBackingStore
DIBackingStoreCreatorProbe: selecting CBundleBackingStore
DIBackingStoreCreateWithCFURL: CBundleBackingStore
DIFileEncodingCreatorProbe: interface 2, score -1000, CEncryptedEncoding
DIFileEncodingCreatorProbe: nothing to select.
DIBackingStoreCreatorProbe: interface 0, score 100, CBSDBackingStore
DIBackingStoreCreatorProbe: interface 1, score -1000, CBundleBackingStore
DIBackingStoreCreatorProbe: interface 2, score 0, CRAMBackingStore
DIBackingStoreCreatorProbe: interface 3, score 100, CCarbonBackingStore
DIBackingStoreCreatorProbe: interface 5, score -100, CCURLBackingStore
DIBackingStoreCreatorProbe: selecting CBSDBackingStore
DIBackingStoreCreateWithCFURL: CBSDBackingStore
DIBackingStoreCreateWithCFURL: creator returned 0
DIBackingStoreCreateWithCFURL: creator returned 0
DIDiskImageCreateWithCFURL: creator returned 0
DI_kextWaitQuiet: about to call IOServiceWaitQuiet...
DI_kextWaitQuiet: IOServiceWaitQuiet took 0.000013 seconds
Formatting…
Initialized /dev/rdisk4s2 as a 488 GB HFS Plus volume with a 40960k journal
Finishing…
created: /Users/jeff/foo.sparsebundle
hdiutil: create: returning 0

df -h /Volumes/Test1\ 1/
Filesystem Size Used Avail Capacity Mounted on
/dev/disk4s2 488Gi 474Gi 14Gi 98% /Volumes/Test1 1

Any help would be much appreciated. I'm running 10.5.5 on a G5. Thanks!