The windows snapshot component VSS will fail if a disk with a non-standard sector size is attached to your system. This error will occur regardless of whether the disk is a backup source or target. This can be an internal disk or one connected by USB or eSata. The issue is actually caused by USB enclosures that modify the disk drive geometry in the USB to SATA bridge.
See also: VSS Fails due to modification by 3rd party software
Windows XP, Vista, 7, Server 2003, 2008, 2008 R2.
Extended error information
The extended VSS error information in the VSS log will be reported as below. Note the result code may be different, but the extended error will always be:
Identification of disks with a non standard sector size
Run 'System Information' ('All Programs' > 'Accessories' > 'System Tools' > 'System Information').
Expand the Components->Storage->Disks node, and scroll down the list of disks, looking for any that have a Bytes/Sector value not equal to 512.
Windows XP, Vista, 7
Unfortunately, until Microsoft fixes this issue, the only option is to remove this disk from your system. Read this Article for general information regarding Microsoft support for non-standard sector sizes.
Windows Server 2003, 2008, 2008R2
Whilst Microsoft's official position remains that disks with non-standard sector sizes are not supported, there is a possible workaround for Windows Server Operating Systems using a command-line tool called VSSAdmin.
If you run the following command for every drive on your system (replace X: with the drive letter), using a command prompt with elevated privileges then you may be able to successfully use VSS with a non-standard sector size disk attached:
Windows 8, 8.1, Server 2012, 2012R2, and later
These operating systems support disks that report a native sector size greater than 512 bytes.
More information on Windows support for disks with sector sizes greater than 512 bytes can be found here: http://support.microsoft.com/kb/2510009