I upgraded an ESXi 5 host to 5.1 and received the following error after the upgrade was finished and I had tried to VMotion to the upgraded server:

The VM failed to resume on the destination during early power on.   (This happened at 65%)

I read articles on setting a new Heap size…FAIL, making sure the NFS share names were correct and not upper/lower case…..FAIL.

It turns out I was using the server I upgraded to try run ESXi 5.1 in Nested mode. This does not work with an EPT Intel processor. During my attempts to try trick ESXi5 into running a 64 bit VM (nested mode) I added the following to: /etc/vmware/config:

vhv.allow = “true”

vhv.enabled = “true”

Once I removed these lines and rebooted, VMotions started working again.