First time posting, searched google for days and finally found you guys.

I have an ex495 that has 4GB of ram and an upgraded CPU, but stock out of the box HP software. Only one drive, a 2TB seagate that has been doing well for a few years. I want to add more drives so I ordered a 4tb Western Digital green that I now know wont work.

1. I need lots of storage, am I going to be capped at 2TB per bay total if I do not upgrade to WHS 2012?
2. On the stats for this server it said it would support up to 17TB, however if i do not know how if it cant use 4TB drives out of the box.
3. If I upgrade to WHS 2012 will I be able to use 4TB drives? I need more then 8TB total(2TB per bay) (I store lots of movies and music)

any insight would be really appreciated.

You are in luck, you have found one of the best places on the net for info and help on these servers.
Your question:
It supports the extra storage via USB and Esata external enclosures. You can find 8 bay USB and/or Esata.
Yes you can use the larger drives if you upgrade the OS but then buying the video cable will make it a lot easier. Also there are a couple of options for drive pooling "DE replacements"
With the video cable you can install any OS you want, I have installed win2012E on one and it worked fine, had to find a couple of drivers, but no big deal.

I tried (2) 4tb drives as non-pooled server backup drives formatted GPT and they worked it the data on them went higher then 2tb and then they went RAW and would not reformat, had to send them both back in and now they live in my DIY win2012E box.

Hope this helps and good luck...

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[X510 CPU/RAM/All 2 TB Red's] [X510 CPU/Sync'ed Backup/All 2 TB Hitachi's]
[X510 /2 in box]
[X710 LIAN LI DIY W2016E] Stablebit Drivepool [EX-503 LIAN LI 5-bay USB3 External]
Fear the Cloud

In theory WHSv1 supports up to and I forget but I think its up to 32 drives but in reality its more like 30 but you would need to use external enclosures on your EX495 as Gardian has already pointed out and they can get cost prohibitive and you may also experience drive drop out issues along the say which is very annoying which is why I moved away from WHSv1.

WHS2011 with a 3rd Party Pooling software will support the larger then 2TB drives and then there is WS2012. Problem with WHS2011 is finding it because its no longer being sold so to obtain it you need to find someone who has an unused copy of it and WS2012 is just expensive and not really worth installing on an MSS because the hardware is starting to show its age and its better on something more robust. As Gardian has already pointed out a DEBUG Cable would make it easier to install and actually troubleshoot. You can do blind installs but its penny wise and dollar foolish because if you ever have a network issue your dead in the water which is even the case with the stock software.

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Exploring the possibilities!

Migrated from WHS2011 to WS2012E: HIGHLANDER

~ Norco 4220 Enclosure
~ Gigabyte GA-990FXA-UD5
~ AMD Phenom II X4 995 3.2 GHz
~ 8 GB Corsair Vengeance DDR3 1600 (PC3 12800)
~ 3 Supermicro AOC-SASLP-MV8

Sorry for taking so long to reply, I was out of town for a bit. So to make sure I understand you guys.

-4TB drives do not work in the stock build because once they reach capacity they tend to die and have to be returned.
-Buying a video cable will allow me to custom install a new OS much easier and will be a much wiser decision
-If I want to use higher data drives I have to upgrade to WS2012 since 2011 is much harder to find
-WS2012 is better on newer machines (I didnt mention but I did upgrade my server hardware to have 4gigs of Ram and a Core 2 Duo CPU when I first got it)
-As it is currently it can use a 2TB drive, would it also use a 3TB drive without issue or is 2tb the cap?

I am going to politely disagree with Comp1962 a bit here with respect to running Server 2012. I've got an EX487 and EX490 both running Windows Server 2012 R2 Standard, the former of which has the Essentials role installed. I'm using an SSD as the system disk on both of these, and both have Intel Pentium E5300 processors and 4GB RAM.

Despite the fact that these are "older" machines, they handle Server 2012 R2 surprisingly well. Granted I'm just using the servers for backups and large data storage, they do so very well and I've never had performance pop up as a problem. I have to give credit where credit is due. HP built a solid machine with these little servers. Aside from having to replace the PSU in the EX490, I've not had a lick of trouble with them.

I also bought an EX495 that I haven't done a whole lot with yet, other than put an SSD in it. It's got a quad-core processor but only 2GB RAM. The 4GB DDR2 sticks are really expensive, so I haven't bitten the bullet to upgrade that one yet.

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Matt Sawyer
Owner, Dojo North Software, LLC

HP EX490, 4GB, E5300, 15TB - Server 2012 - Sharing and Streaming
HP EX487, 4GB, E5300, 13TB - Server 2012 Essentials - Backups