> This bug does not appear in 9.04 as I can install it just fine and
appears to specifically relate to grub 2 + large drives.

Not exactly.  Short explanation:

- Large drives (>2 TiB) need GPT instead of DOS-style partition labels.

- GRUB 2 supports GPT in two ways: a robust one, which requires the BIOS
Boot partition, and the blocklist method which we don't recommend (see
http://grub.enbug.org/BIOS_Boot_Partition for details).  Even then,
blocklist-based installs should work, although we can't really guarantee
that they will continue to work after long periods of using the
filesystem, or after doing certain things with it.

- GRUB Legacy doesn't support GPT at all.  There's an unofficial patch,
which is included by some distributions (including Ubuntu) which enables
support for the blocklist method ONLY.  This is, of course, far from
optimal.  But my understanding is that work is under way to get this
properly sorted out in Karmic.

HTH

-- 
update-grub never runs because ubiquity crashed with InstallStepError in 
configure_bootloader()
https://bugs.launchpad.net/bugs/419911
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