EXT format is the disk format used for Linux (just like NTFS is the disk format for Windows). EXT3 and EXT4 are the main versions. http://en.wikipedia.org/wiki/Ext3
"Restoring over the network" means copying data back to the NAS over the network. For instance, plugging the USB drive into your PC, and drop/dragging the files back onto the NAS. Some users say that is faster for normal NTFS formatted USB drives. In my case, I back up my Pro to my two older ReadyNAS - so all backups/restores are done over the network.