Thanks for the response!
As for the minor issue, I already have upgraded to the latest available firmware (1.33)... same issue. I think the underlying box is just some Linux/Unix build, so why can't they include mkdir permissions in the "read/write" setting? Seems like an incomprehensible and meaningless restriction to me.
As for the major issue, I can actually live with it now that I have figured out that there simply is an undocumented "feature" built-in by having to specify the array as the root folder before specifying the actual share as the next down-level folder.
Funny thing... my minor issue is actually major, and the major thing is just lack of Buffalo documentation and not a big deal at all...