We had the EXACT same issue as Daniel. Environment:
BE 11d
W2k3 R2 SP2
HP Proliant DL320 G5
LSI Logic PCIE U320 controller
HP MSL2024 Loader with single HP Ultrium 960 (LTO 3) drive
I noticed the same error as the original poster - backups failing after a variable amount of time (but usually within 15-20 minutes of start-time) with "unknown hardware failure" type errors, specifically "Final error: 0xe00084ed - A hardware error occurred. Final error category: Backup Device Errors"
Complicating things, just before this started, I had the motherboard on the server die for unknown reasons. (I think it was the rubber band I found under the board causing a short - the DL320s are cheap piles of junk.) I installed MS KB932755 (Storport update) either just before the death or right after I replaced the motherboard. I thought nothing of this and forgot about the update.
Then, I couldn't get backups as mentioned above. I replaced the tape drive under warranty. Replaced the cable. Even got a new terminator. Same problem continued. I'm pulling my hair out and playing without a net now (only shadow copies and to-disk SQL dumps).
Even more baffling to me was that I could run about 100GB of data from the main file server, but when I ran our normal nightly backup (of about 6 machines) it would fail at a variable location, anywhere from 7GB to 20 GB in and usually in 20 minutes or less. HP Library & Tape Tools had no problems either, at least not with a standard "hardware test" that overwrites a tape. I didn't try specifiying a full-tape test though.
On a last ditch hunch before wasting time wading through clueless tier-1 support techs, I pulled off the storport update / KB 932755 and boom, my backup is now 52GB in and still running, without any issues yet. I have a feeling I'll have all 230GB on tape by tomorrow.
This is definitely a bug in the update or something that BExec is doing. I'm going to post this info in the BE11d forum as well to warn people about it, hopefully someone at Symantec takes a look and can get in touch with Microsoft and get this resolved. Considering that HP suggests installing this update along with their latest storage drivers, the issue will probably keep growing if people are patching systems as they should...