It wasn't a limit to 500GB, but a limit to 500 games.
The limit is due to the HDD physical sector's size, as 1 sector is used to store the list of available games.
Old HDD have sector size of 512 bytes (1 byte per games ID : 500 bytes are used for listing available games, 12 for other things).
Newer HDD have sector size of 4096bytes, so you can now hold up to 4084 games on a WBFS partition.
On old HDD, there's an option to "fake" the physical sector size and use two sectors to store the list of games :
512 + 512 = 1024 = 1012 games.
If it's your only HDD, I recommand that you use a FAT32 partition.
FAT32 can be used to store homebrews, but it can also be used for a feature which is currently becoming more and more used : Emulated NAND.
You extract the content of your Wii to your FAT32 drive, and you can use it as if it was your real Wii.
A 2TB Wii
multiple wii on the HDD, for different things. (could be a PAL wii/NTSC Wii, or a Wii for Channels only, etc.)