Cannot Configure Backup Schedule - another reason.....
OK, so today I got this error detailed on this EMEA SBS Team blogpost
http://blogs.technet.com/asksbs/archive/2009/01/26/sbs2008-cannot-configure-backup-schedule-error-when-you-run-configure-server-backup-wizard-on-small-business-server-2008.aspx

It turns out however that my problem was not what the EMEA team were reporting, my issue was that my Dell OEM preinstalled SBS2008 server had a FAT32 Partition on it that looked like this:

The fix for me was to convert the FAT32 drive to NTFS using the convert d:\ /fs:ntfs command.
I believe that the SBS documentation / support team are writing up some documentation on this right now 