Hi guys - just a few notes on NAS devices, I am running two, a QNap TS419P w/ 4x 2 TB drives in RAID-5 and a home built Debian Linux with 10x 2TB drives in RAID-6 + Hot Spare
Time Capsule / Airport Extreme is definitely the easiest and most compatible but also about the slowest solutions. Just fine for Time Machine, I'm sure you can even stream 1080p MKVs off them but doing file copies it is a bit painful. I have an Airport Extreme, I don't even use it for it's NAS capacity anymore.
iSCSI is used for SAN (SCSI over IP), not NAS, it's a bit different in that it will show up on your Mac as a disk device that you must then partition, format and mount, and you cannot share it across multiple computers at once. Kind of a niche need, if you don't know what it is you don't need it I think it's safe to say. Also you'll need to download a 3rd party iSCSI initiator driver to use this (like globalSAN's software).
I looked at Synology vs. QNap for a while and the hardware is pretty much identical, Synology is a little cheaper, but I prefer the QNap software, there are live demo sites you should check out before buying either:
http://www.qnap.com/liveDemo.asp
http://demo.synology.com
Look at smallnetbuilder.com for benchmarks, they also benchmark Airport Extreme/Time Capsule I think, but with NAS devices you get what you pay for, the more expensive ones tend to be faster as most of these are CPU bound. For the ultimate performance to price ratio you need to go home-brew as a low end Linux on Intel homebuilt NAS (~$300) will be faster than a mid-range ($800) ARM based NAS. Tradeoffs would be heat/noise (Intel draws more power than ARM so energy consumption will be higher and you need to pay attention to your fan/cooling situation), size & aesthetics of the unit. Hot-swap is nice but kind of silly in a 4 or fewer drive device especially for home use when it's not a problem to take it down for maintenance, why not spend the extra on higher performance?
I've never worked with the ReadyNAS devices but when I looked into them they were not even in the running as the performance to price ratio was not very good.
Almost all of these low end / consumer NAS devices run Linux btw, and the good ones (like QNap and maybe Synology) do offer shell access so you can hack away as you like.
As for RAID setups, avoid RAID-0 unless your data is disposable as with two drives you just doubled your failure rate (n * 2; n being failure rate). With RAID-1 you will decrease it exponentially (n^2). RAID-5 is usually a good tradeoff for home use as the data can survive one drive failure. RAID-6 can survive two, and using hot-spares in addition to any RAID level (except 0) is a good idea if you can spare the drive bay.
Drives are so cheap these days, 2 TB for $70 !? Either run 2 drives in RAID-1 or get at least a 4 bay enclosure and run RAID-5 + hot spare or RAID-6, unless you don't care about your data or are taking backups.
Building a home-brew Linux NAS, even using off-the-shelf raid distributions is a great way to learn linux.
Incidentally when you click on the server name in Finder and it says host not found, it's probably an issue with mDNSresponder/avahi, try restarting just that service on your NAS.
Rob