BIG BUG in Update 2
Great News flash post @ Virtualization.info
Basically, any ESX implementation that is running ESX Update 2 (Build 103908) will not be able to power on or vMotion Virtual Machines as of August 12th due to some error code in the latest version.
A portion of VMware customers could be affected and the knowledge base is now down.
A patch should be released shortly to address the issue.