WHS v2 is now in Beta status and one of the biggest changes over v1 is the revised Drive Extender.
In v2 Drive Extender now uses a block-based file-system below NTFS. With this change also comes a change in how data is written to disk – no longer are the drives NTFS formatted with the files spread among them, rather now they’re using a custom format that only WHS v2 can currently read. That means that only WHS v2 can read drives formatted in this fashion. In addition, files are now stored in 1GB chunks and can span HDD devices, possibly leading to an issue with failed disks where parts of files could potentially be lost.
On the good side, there is now support for Encrypted File System as well as NTFS compression. Duplication is now immediate instead of requiring Drive Extender to periodically reorganize and copy files. Files are also no longer limited in size to that of the largest HDD device; seeing as chunks can now span multiple devices.
Drive Extender was recently compared to ZFS, the Sun block-based file-system, however one big difference is that ZFS volumes are typically put together using some sort of redundancy like mirroring or RAID. We’ll have to watch this space to see if this particular weakness is fixed in the final WHS release.