So you can keep the Raid5 ability with drives over 1TB but you will then lack the GUI or are you saying that you will lose the RAID5 as well?
You can keep the raid5, but you have to do work at the linux level to get the RAID5 arrays mounted whenever the system is booted as the start up scripts built into the standard firmware will not be doing this for you.
Is there anyway to format these drives without the use of telnet command line interface?
Such as a 3rd party linux partitioning program running on your PC? I would not have a problem placing the hard drives in my PC if needed.
It is not that the partitioning could not be done elsewhere, but you would have to be in at the telnet level to set up the raid arrays so you might as well do it all from the telnet level. You cannot let the built-in firmware do this, because as has been mentioned it does not know how to handle these larger disks. You would also have the isue of making sure the system and swap partitions are set up correctly if you tried to bypass the recommended process.
It is worth pointing out that you can experiment with what needs doing at the telnet level without having the larger disks physically installed. The process is basically the same whatever the size of the disks installed, so (assuming you have any disks at all) you could try it on those already present.