Failed to deploy template: The virtual disk is either corrupted or not a supported format
updated 03.13.08 - Unfortunately I declared victory too soon on this issue. I got a status update this week and the customer can deploy from template in some scenarios but is still getting the same error at times. The HP SIM agents are still turned off and have not been ruled out as part of the problem, but IBM has provided a recommended design and they have made the changes.
As Brian points out in his comment the customer has a multiple IBM SVC design in front of multiple storage devices.
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Last week I helped a customer resolve an issue where whenever they deployed a new VM from a template the job would fail with the error “Failed to deploy template: The virtual disk is either corrupted or not a supported format” We were troubleshooting numerous ESX servers and the problem was the same on all the hosts. The template was fine. We changed it back to a VM and turned it on without issue. The vmtools and virtual hardware were up to date.
Surprisingly the Virtual Center error message was not well indexed on Google. I was scratching my head until I stumbled across the VMware Communities thread

