I bought a new WD Elements 2TB usb drive (WDBAAU0020HBK-01) to hold media for my WDTV-Live box. I spent ages moving media (ISO dvd rips, etc) from my PC HDD to the usb drive only to find that when I connected it directly to my WDTV-Live box the drive was not detected.
After reading this thread, I solved the connectivity problem without losing any of my transfered media by using windows own built-in disk management snap-in (as follows).
1. Connect the WD Elements usb drive to your PC.
2. Under the 'Administrative Tools' menu click on 'Computer Management'
3. Click on 'Disk Management' (down the left hand side)
4. From the list of disks in the bottom panel, right click on the primary partition of the WD usb drive then click on 'Shrink Volume'. Reduce the volume size by a small amount (I actually dropped mine down to 1.5 TB).
5. After the volume has been shrunk, right click the partition again and mark it as active. (I am not sure whether this was entirely necessary but figured it couldn't hurt)
Subsequently, the drive worked perfectly with my WDTV-Live box although it takes about 10 seconds to be detected.
Later I increased the volume size again using the same snap-in and all continued to work perfectly.
Hope this helps.