Despite what Microsoft said, Windows Home Server and Leopard Time Machine won’t work together. You cannot use your Windows Home Server shared storage as a backup target for Time Machine. Microsoft had said they were a “great drive share for Time Machine”, so what happened?
Apple killed SMB (Windows Sharing) support for Time Machine, that’s what. So, basically, Time Machine can’t see the Windows Home Server shares… or any other PC drive shares. Support has been scaled back to AFP (Mac OS) file sharing only.
Worst of all, this means you can’t (as Apple announced) use your AirPort Extreme with the USB port as a Time Machine drive. AirPort Extreme, despite being all-Apple, uses SMB for file sharing (hence all the AirPort Disk software on PC and Mac… to sniff out the SMB share).
Insiders in Apple tell me the main reason was bugs… Time Machine crashed like crazy when using SMB. Having tested this, and stared at the constant kernel panics, I can certainly understand that. However, the good news is, AirPort Extreme could prompt Apple to restore this feature, now that Leopard is out, they have some time to fix it.
Of course, you can only help it happen with feedback… I’d advise you hit Apple where it hurts, in their product matrix, and ask for Time Machine to support AirPort Disk mode… the rest will follow naturally.