My Book Studio II Backups to Time Capsule via Time Machine

Have the WD to use for my large iPhoto collection. Connected to an iMac using firewire. Want to back up the iPhoto library to my Time Capsule.  Unless I exclude the WD from the Time Machine backups, TM backup fails (won’t back up anything). I need to be able to back up this iPhoto library. Should this work?? Btw, I am running OSX Lion. Wondering if Mountain Lio would work better.

You can try updating the firmware to the latest version.