Backing Up VM in P6

How does everyone backup their VM if you have upgraded to P6?

Even though I am not backing up my VM, Time Machine has started to act funny and backs up 3.6GB of data each backup.

Under Parallels/Virtual Machine/Configure/Backup, i have chosen do not backup virtual machine and SmartGuard is disabled. Further under Time Machine/Options, I have excluded the VM from backup.

Using 2.66GHz i7 with 8GB of RAM OSX version 10.6.4.