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I actually wrote the User's Guide, and it's a confusing sentence. What I was saying was that you can't host images on drives that won't support >4GB files, nor will it work with protocols that don't support large files.
So, NAS devices and servers that don't support these things won't work.
You don't need to format a NAS as FAT32 to access it with a PC. That's part of what the network protocol abstracts. After all, you can access your Mac's HFS+ formatted drive from a PC, right?
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--Dave Nanian
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