Windows Home Server uses a storage technology in the backup database which is similar to single instance storage, except at the data cluster level. Only clusters which have changed since the last backup will be written into the database, which is similar in concept to a traditional "incremental" backup. The same technology results in dramatic disk space savings. As an example, my entire backup database is under 500 GB in size, and it's backing up 4 computers every night. So there's really no need for the traditional complete/differential/incremental backup options.
For more information about the backup feature, see the
Home Computer Backup and Restore technical brief.
I'm not on the WHS team, I just post a lot. :)