[dnanian]

By definition, ignore with Smart Update will remove the file. It's ignored *from the source*, not the destination. That means it's not in the set of files to be copied, so it'll be removed instead.

So, here's what you should do:

- Create a folder named "Volume Icons" in your Home.
- In there, place the icon you want, for a given volume, named "the-volume-name.VolumeIcon.icns".
- Download the attached and set it as your "after copy" script in Advanced

That'll automatically set the icon when the backup is done. Note that it depends on having the developer tools installed in most cases (unless the source has a custom icon).