So I create a backup capsule. I make a paragon VD backup of my parition to the capsule. I boot the capsule. I attempt to restore the backup and *.pfi (index) is NOT SUPPORTED? Why would you create a recovery solution that can't recover your native backup format!! Why would you not at least make that clear when creating a backup. What good is backup if you can't restore it from an alternate boot! So given that bit of head scratching what format DO I need to backup with in order for the restore on the capsule to use it.
Most likely you restore VD archive with Simple Restore Wizard or something like that. PFI files should be recognize with both Wizards. Could you please specify particular steps you perform? What is your restoring scenario?