Is it a bug or a feature that the solaris iscsi initiator isn't able to connect to an iscsi target on the same machine, using either the 127.0.0.1 localhost address or the machine's own ip address?
During the last couple of weeks I worked with a customer who bought a Sun Fire X4500 server (you know, Thumper). The plan is to run Solaris ZFS on it, then provide big iSCSI volumes to the video editing systems, which tend to be specialized Windows or Mac OS X machines. Wonderful idea: Just use zpool create to combine a number of disks with some RAID level into a pool, then zfs create -V to create a ZVOL. Thanks to zfs shareiscsi=on, sharing the volume over iSCSI is dead easy.