I saw this back in June 2011, and just notoced it again today. I don't closely monitor the logs from Tomato, so I've probably missed other occurrences.
Thee is a thread on the topic here:
http://www.linksysinfo.org/index.php?threads/how-stop-automatic-blocking-of-ntp-servers.24438/
which I visited back in 2011, and set the nvram variable, but apparently it didn't resolve the issue.
ray123 wrote:
Use different servers.
I'm syncing to a LAN server. There is no reason why it should be rejecting the router's request. The ntpd logs show no records of the router being blocked.
The thread above speculates that the problem occurs when Tomato starts up at the same time as the NTP server, and the NTP server reports a stratum that Tomato's clent deems unsatisfactory, so the rejection is happening on the Tomato side.
It would seem the error message is possibly misleading, and there is likely a bug in the logic used to mark a server as having rejected the router.