Live Disk Partitioning

Leopard OS X is supposed to offer non-destructive drive partitioning using Disk Utility. After I tried to partition my external drive in preparation for Time Machine, I received the following error:

No space left on device

No matter what I did, I received the same error and found some info regarding the error. So no resize yet, I suppose. Time Machine does appear to work correctly on a shared volume, but reports have it that Time Machine will delete all data from unsupported volumes.