Using Lion Server for time machine backups...help!

I bought a new Mac Mini Server last week for a number of reasons:
- Collaboration on Site Designs, etc
- Media Centre
- Time Machine back up host.

I am having a little difficulty using it as a time machine drive.
I have shared the second drive (which I intend to use for TM) and can see it from my MBP (also running Lion). When I open TM preferences and select the disk, the only option I have is 'set up other time capsule'.
How do I point it to the drive I want? Am I 'sharing' the drive in the wrong way?

Thanks for any help or hints you may be able to offer!

Ryan

 

Thanks for your help guys, got it going thanks to you.