the good news is that the hard drive / time machine part works well
the bad news is that all of the computers on my network (leopard or vista) randomly lose the router every couple of days. it is extremely annoying and i am now at the point of having to spend money to replace the product as i cant take it anymore.
Many people on the apple forums recommend rebooting the router every week but i have had many linksys routers before this apple one and never once had to resort to that kind of action.
in summary the quality of this product has been an disappointment for me.

It's strange that wireless has become so ubiquitous that one would by a router like this and not use the wireless capabilities at all. But that is exactly what we've done.

We have 16 of these Time Capsules acting solely as remote backup drives. We've turned off all wireless and router capabilities. Each machine has a static ip address and we connect to it for our Time Machine backups.

Overall, the hardware has been magnificent and the "Airport Utility" makes it quite easy to configure the device.

I swapped out my old Apple Airport Extreme for this Time Capsule, left the network name and password unchanged -- and that was it. My desktop, and my wife's and my iPhones and MacBooks acted like nothing had changed. No settings to update or anything.

Except a couple things had changed. First, our network got lots faster. Second, now both of our 160GB MacBooks are always backed up on one hard drive, wirelessly and seemingly magically.

How cool is that?

I expect that if you have just one Mac connected to the Internet then this is a fine product. However, if you already have a mature network setup with multiple devices connected and you do not wish to disturb your environment then it seems unnecessarily difficult to connect this device to your network. The Time Capsule configuration seems to be obsessed with setting up a wireless network. I've had my capsule for 24 hours and so far only one of the two Macs I'm backing up to it have backed up successfully. I have had to reboot my wireless access point several times since I put the infernal Time Capsule on my network. While over time I might migrate network functions to Time Capsule (wireless network provision, printer sharing) I really do not want to have to completely re-configure my entire network just to use Time Machine. At the moment I am 50/50 over whether or not to return this box to the store.

If you are looking for a reliable router, keep looking.

3 days after the 90 day warranty (phone support) the TC started overheating and slowing my connection. The Apple support guy was a real tool. He wanted me to pay to talk to him. Appalling.

After insisting to speak to a supervisor and 1 week later, I finally convinced Apple to replace my TC.

As soon as I got it, it was on Ebay. Avoid this unit like the plague.

Buy Dlink or Linksys, a product that's reasonably priced and well supported.