I am having a similar issue and was wondering if anyone else has been able to get this combination working.
We are using a TS5400R2C0 annd I'm trying to connect a VMware ESXi host running version 5.1 u1 via iSCSI. There is no switch involved as the host and Terastation are connected directly via a patch cable.
At first, it seems to work. I am able to connect the the LV and create a datastore, but when I try to create or copy a file to the datastore, it copies about 8MB and then the process just hangs. From that point forward, any interaction with the datastore hangs and eventually fails.
As a test, I connected a Windows 2003 VM located on the ESXi host in question and was able to create an iSCSI connection to the Terastation without any problems. This seems to work fine and I was able to copy large files (4GB+) without any issues. This tells me that the Terastation, NIC, and patch cable are all working properly. This leads me to believe there is a compatibility issue between the Terastation itself and ESXi 5.1 u1. I have tried adjusting iSCSI settings on the Terastation as well with no success.
If anyone has gotten this to work, please let me know. I'd also welcome any other suggestions to try.
Thanks!