You are almost there, but blocksize is only part of the equation.
The trouble here is that the nbd generally has no idea how big it is, so using dd as the example displays will happily try marching right off the end of the device and produce an I/O error. On Technologic Systems devices using sdctl, a nbd is generally pointed at a local eMMC, SD, or other local storage resource.
One thing you can do to confirm this is what happened on TS hardware is to run a couple diagnostic commands with sdctl. You will probably see something like this:
# sdctl --stats
# sdctl --dmesg
Jan 1 01:38:57 Access beyond EOF, sec=3776488, len=256, req=0
Jan 1 01:38:57 Access beyond EOF, sec=3776744, len=256, req=0
Jan 1 01:38:57 Access beyond EOF, sec=3776504, len=8, req=0
The way to avoid the I/O (ran past EOF) error is to always give your dd a constraint when dealing with nbd-using storage drivers, such as:
dd if=/dev/nbd1 of=/my/backup.dd bs=1M count=1024 conv=fsync
By providing a count of the blocks you want to read, you can avoid falling off the edge of your media. Blocksize and count can be almost anything, so long as bs*count <= actual media size.