After many trials and errors, I might have found a way to erase a Sparsebundle faster without having to wipe your entire Time Capsule, or using 3rd party programs.
My Setup: I am using the latest update of OS X Lion up to date. I have a 3 TB Time Capsule to which I back up to, through a Wifi connection.
For this exercise, I connected my device (Laptop) to the Time Capsule through a data cable and not through WiFi - please note that you can also do this through a WiFi connection if you do not have a data cable.
In settings, set your device to never go to sleep in Energy Saver - this is optional - so as not to interrupt the deleting process.
Then in the right window, double click on Network.
Then, double click on the hard drive where the Sparsebundle is located that needs to be deleted (click your way through until you reach the window where the Sparsebundle is located - i.e. in my case it was Device Name -> Network -> Time Capsule -> Data -> [this is the spot where my Sparsebundle was located]).
Highlight the Sparsebundle (do not double click on it!).
Click on the little gear button at the top of the window -> then click on "Show Package Contents" in the dropdown box.
After a few moments, files will appear on the right side.
Double click on the "Bands" file and wait for a few seconds/minutes for the bands/files to appear in the new window (there could be as much as 75 000 lines, and more, depending on how long you have been using this Sparsebundle).
Setup to delete Bands:
1. Open up the "Force Quit Applications" window by holding down on "Command" + "Options" and the "Escape" keys simaltaniously, and drag this window to the right side of your screen (for convenience sake).
2. Decrease the size of the main Finder window that contains the bands, and drag it to the left side of the screen.
You are going to use both windows at all times.
Now, right at the start, relaunch Finder in the "Force Quit Applications" window by highlighting Finder and then click on "Relaunch" at the bottom of the window.
Wait a few moments for the bands to reappear in the Finder window.
Then highlight about 5000 bands at a time and delete them (choosing less will go faster). It might take a while to count the bands and start the deleting process, but be patient.
Then, after the selected lines are deleted, (OR at any time if the process gets stuck for more than a minute), just relaunch Finder again and restart the process.
This is the trick - Relaunch Finder after every batch of bands you delete. (I do not know why, but it works!)
Relaunch Finder -> Delete bands -> Relaunch Finder -> Delete bands -> Relaunch Finder....... etc.
When you are done, do not forget to reset your Energy Saver settings in System Preferences.
By doing this, I was able to delete more than 17 000 bands in 5 minutes as opposed to waiting for 18 hours to delete 31 000 files at a time (in one batch). My original Sparsebundle of 75 000 lines took me almost 48 hours to delete in the old way. With this new way of "Relaunching Finder after every delete" the process was lighting fast in comparisson.