I am really interested in the WDTV to view my video files. I would love to be able to attach an external HDD via a USB cable to the WDTV, but also have the ability to copy the video files to the external HDD via Wireless-G/N or wired ethernet. It seams to me that the external HDDs have either USB transfer or are NAS's (even the NAS's with USB are only to attach a printer or additional external HDDs), but never both. Do I have something wrong? Any particular product that folks know about that would accomplish what I want. Thanks in advance for any advice.

I am really interested in the WDTV to view my video files. I would love to be able to attach an external HDD via a USB cable to the WDTV, but also have the ability to copy the video files to the external HDD via Wireless-G/N or wired ethernet. It seams to me that the external HDDs have either USB transfer or are NAS's (even the NAS's with USB are only to attach a printer or additional external HDDs), but never both. Do I have something wrong? Any particular product that folks know about that would accomplish what I want. Thanks in advance for any advice.
There are one or two combo USB/NAS combo devices out there but be aware that those are usually FAT32 so 4GB file limits apply. Another solution that ma fit you needs is in this thread: Firmware - Western Digital - WD TV HD Media Player
There are some modded firmware that have USB ethernet dongles enabled with ftp