MacOS X Rsync Server

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I am trying to set up a MacOS X rsync server and am not having much 
success at the moment.  I'm able to see the "share" alright, but here 
is what I get when I actually try to copy anything to the server:

#rsync -vz /Users/myhome localhost::backup
@ERROR: setgroups failed
rsync: connection unexpectedly closed (37 bytes read so far)
rsync error: error in rsync protocol data stream (code 12) at io.c(150)

I get the same result on any linux server I try this from as well.

My simple trial rsyncd.conf is:

[backup]
   path = /Volumes/Backup
   comment = Backup Directory for OS X
   read only = false

Any thoughts as to why this is happening?