Okay..after screwing around and trying some different things I somehow got my drives.
I wiped the drive and then re formatted it with my older Hopper w sling, then as soon as I plugged it in to the H3, it came up and then went to a software update from 503 to 507... even after I tried to do that a couple times already in tools ???
So It seems to be acting normal, I transferred a show back and forth then I hooked up all 3 of drives and they all worked and played shows from each. The only snag was when I tried to transfer about 90 Myth Busters at one time and it did a few before it gave me the error code, then tried again and now says "the transfer completed with errors"..no go.
So not fixed completely yet but better, also it doesn't go to the spin up box like others are seeing but the drive hasn't gone to sleep yet...so the fight continues....