If you are currently deploy the nexus 1000V with the vSphere 4 update 1 and plan to run windows 2008 R2, here are some major issue we had faced for the pass 2 weeks. We experienced all the windows 2008 R2 with packets drop right after the vmotion completed. the Windows 2008 R2 virtual machine will not be reachable from external, but you can ping the gateway from the virtual machine console as usual. After our research and troubleshoot, this was due to the multicast function which seems to be conflict with windows 2008 R2 and become 1 of the major bugs in the Nexus 1000 version 1.2. There are some work around which suggest to turn off the igmp snooping, but our scenario, this didn’t work as it needed. If you are running on windows 2003, you will not experience the situation as we experienced here.

After some discussion with tech support and knowledge base research, this seems to be an issue and able to be resolved with an upgrade to Nexus 1000 version 1.3. We had successful upgraded our VSM to version 1.3 now, and of course we updated the VEM module on each of the ESX host, and the problem resolved. If any of you hit to the same situation, I will suggest you to patch all the esx host, and perform the upgrade of nexus 1000 to version 1.3, this should overcome the packet drop issue.