Do you have wood chips (what type do you use if any?) in the other parts of the rabbit's cage? It's best to use kiln dried pine bedding, and I have used this in my bunnies' litter boxes without a hitch. Doesn't affect their littering habits, although it might affect a bunny new to being litter trained.
You could use wood pellets in the litterbox. They break down when wet, and help with odor control.