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This sounds to me like you are saying I can back up to a network drive, yet you've also explained that network drives are unreliable and not recommended.
Two different definitions of network drive.
A shared drive on another Mac (internal or directly-connected via USB, FireWire, or Thunderbolt) is fine. Time Machine on the Mac being backed-up communicates with OSX on the destination. Again, all software from one source. The drive is just a "dumb receiver" that happens to be on a network from the point of view of the other Mac.
As explained in the earlier link, a NAS has its own programming, often quite powerful in other ways, supplied by the NAS maker. Time Machine dosn't communicate directly with the drive.
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It has an ethernet port and it says it's compatible with Time Machine. It doesn't call itself a NAS, but "a personal cloud storage drive" which connects to a network. So is that actually just a NAS by a different name, or would this work for me?
It's a NAS, not a "dumb" drive. Look at all the things it will do. HDs don't do that by themselves. Go to WD's site and look up the instruction manual.
Nearly anything that connects via Ethernet is a NAS.